Yuan Losses Show China’s Struggle to Defend Its Currency

The People’s Bank of China set the yuan’s fixing at 6.9798 per dollar on Thursday, 850 pips stronger than the average estimate in a Bloomberg survey of analysts and traders. Photo: Bloomberg

(Bloomberg) — China’s yuan is set for its longest losing streak since June even after the central bank sought to support the currency with stronger-than-expected fixings in every single session for nearly a month.

The onshore yuan slid for the fourth straight day to trade just 0.5% shy of the weak end of its allowed trading range with the greenback following the Federal Reserve’s jumbo rate hike. The currency can trade up to 2% on either side of the fixing. The dollar-yuan’s discount to the fixing has also widened to 1,000 pips, a gap unseen since 2019. The moves suggest that Beijing’s efforts to stem the currency’s depreciation have done little to restore confidence.