The yuan is closing out its strongest quarter against the dollar in more than a decade, boosted by optimism over China’s economic outlook and by the country’s comparatively high interest rates.
From the start of July through Friday’s close, the yuan has strengthened 3.7% against the dollar. That puts the yuan on track for its biggest quarterly gain since early 2008, FactSet data shows. The only other bigger quarterly gains on record are from the 1970s and 1980s, long before China began reforming its currency market in 1994.
China’s resilience, as the first country to suffer from the coronavirus and then bring it under control, has helped, said Jason Brady, president and chief executive of Thornburg Investment Management. “What we do see is a strong Chinese economy, which is part of what’s behind the strong renminbi,” he said, using another name for the currency.
Having returned to work, China is