China’s yuan strengthens to near 3-year high as US dollar uncertainty grows
South China Morning Post
by Sylvia MaFebruary 25, 2026
AI-Generated Deep Dive Summary
China’s yuan has reached its strongest level against the US dollar in nearly three years, reflecting a combination of factors including easing trade tensions between China and the United States, the Federal Reserve’s rate cuts, and ongoing policy volatility under President Donald Trump. On Wednesday afternoon, the offshore yuan traded at 6.867 per US dollar, marking its highest value since April 2023. Additionally, the People’s Bank of China set the yuan’s midpoint rate at 6.9321 per US dollar, the strongest level since May 2023. This steady appreciation of the yuan over recent months underscores a shift in currency dynamics influenced by both economic and political developments.
The strengthening of the yuan is partly attributed to reduced trade tensions between China and the United States, which have been a significant factor in currency markets. The Federal Reserve’s rate cuts have also played a role, as lower US interest rates tend to weaken the dollar against other currencies. Furthermore, President Trump’s unpredictable policies, including his recent trade actions, have created uncertainty in global markets, potentially contributing to the yuan’s resilience.
Recent developments in US trade policy have added another layer of complexity. The US Supreme Court struck down Trump’s sweeping global tariffs, signaling a shift in the legal landscape for trade measures. This ruling came as President Trump announced his upcoming visit to Beijing, scheduled for March 31 to April 2. While this could be an opportunity to address ongoing trade disputes, it also highlights the unpredictability of US trade policy, which continues to weigh on global markets.
The yuan’s appreciation has been steady but cautious, with the official fixing rate consistently set slightly weaker than offshore levels in recent weeks. Analysts believe the People’s Bank of China is maintaining a delicate balance, aiming for a stronger currency while avoiding sharp fluctuations that could destabilize the economy. This approach reflects China’s broader strategy to maintain economic stability amid shifting global dynamics.
The yuan’s strength matters to readers interested in global economics and market trends, as it signals shifts in trade relations, monetary policy, and geopolitical dynamics. For businesses and investors operating in international markets, the yuan’s appreciation could impact trade balances, investment flows, and risk management strategies. As China continues to navigate its economic trajectory and engage with the rest of the world, the yuan’s performance will remain a key indicator of broader economic health and global market stability.
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Originally published on South China Morning Post on 2/25/2026