RBC forecasts a much weaker yuan in 2025, project USD/CNY to 7.55 by year end

RBC projects the USD/CNY exchange rate to rise to 7.55 by year-end.

Analysts at the bank cite:

• weak economic prospects for China, the economy remains burdened by the real estate slump and sluggish consumer spending, with no clear resolution in sight for these issues
• the likelihood of another US-China trade war following Trump’s win
• yield gap between US and Chinese 10-year bonds will widen, as the People’s Bank of China is likely to adopt looser monetary policies, while the Federal Reserve may slow its rate cuts

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Shanghai Composite update, a soft start to 2025:

This article was written by Eamonn Sheridan at www.forexlive.com.