FINANCE

Yuan Hits Highest Level Since May 2023 Despite Dollar Rebound

Published: Feb. 4, 2026 1:48 a.m. GMT+8

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A screen displays the yuan’s daily midpoint fixing against the U.S. dollar at 6.9352 in Shanghai on Feb. 3, 2026. Photo: VCG

The Chinese yuan extended its rally against the U.S. dollar on Tuesday, strengthening past the 6.94 mark to its highest level since May 2023, even as the greenback recovered in global markets.

The onshore yuan closed at 6.9362, up 151 basis points from the previous session, lifting its cumulative gain to nearly 280 basis points since Jan. 23.

The currency’s resilience in the face of a rebounding dollar underscores a decoupling of asset trends driven by shifting views on U.S. monetary policy and global risk, challenging the usual inverse correlation between the two currencies.

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The Chinese yuan strengthened past 6.94 per dollar, reaching its highest since May 2023, despite a global rebound in the U.S. dollar.
The People's Bank of China signaled more tolerance for yuan volatility, setting the daily midpoint at 6.9608, rather than aggressively intervening.
Analysts attribute yuan strength to structural trends like de-dollarization and note its mixed impact on Chinese exports and monetary policy.

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Who’s Who

Onepoint BFG Wealth Partners: Onepoint BFG Wealth Partners is an organization that employs Peter Boockvar as its chief investment officer. Boockvar believes the yuan's appreciation reflects a global trend of de-dollarization and risk diversification, potentially impacting foreign investors holding U.S. assets.

Soochow Securities: Lu Zhe, chief economist at Soochow Securities, suggests that the sensitivity of Chinese exports to exchange rate fluctuations has decreased since 2018. This is primarily due to an improved export mix, featuring high-end products with strong comparative advantages, and an increasing share of trade settled in yuan.

Citigroup: Yu Xiangrong, chief China economist at Citigroup, believes the yuan needs to appreciate to correct external imbalances. However, he warns that a stronger yuan acts as monetary tightening. He suggests that without strong domestic stimulus to offset China's supply-demand situation, a significant yuan revaluation would be counterproductive and improbable.

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What Happened When

Since 2018：: The sensitivity of Chinese exports to exchange-rate swings has diminished, due to an upgraded export mix and a rising share of trade settled in yuan.

Late 2025：: Chinese policymakers countered yuan depreciation pressure with negative spreads exceeding 300 basis points.

January 19, 2026：: The U.S. dollar index began a decline amid concerns over Federal Reserve independence and the Greenland crisis.

January 23, 2026：: The cumulative gain of the yuan started to be tracked; as of February 3, 2026, it had gained nearly 280 basis points since this date.

January 29, 2026：: The Federal Reserve paused interest-rate cuts.

January 30, 2026：: President Donald Trump nominated former Fed governor Kevin Warsh as the next central bank chairman.

January 30, 2026：: The U.S. dollar index's decline ended, marking a total drop of 2.4% from January 19, 2026 to January 30, 2026.

By February 3, 2026：: The U.S. dollar index rebounded to 97.6.

February 3, 2026：: The Chinese yuan closed at 6.9362 against the U.S. dollar, reaching its strongest level since May 2023.

February 3, 2026：: The People’s Bank of China set the daily midpoint fixing at 6.9608, adjusting it 95 basis points toward the weaker side from the previous official close.

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