Morgan Stanley has come up with a new analysis, the one that projects a robust Chinese yuan against the US dollar in Q1, 2026. The leading banking giant has stated how the yuan is set to bank the current macroeconomic elements pressuring the dollar to climb up high on the radar.
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Chinese Yuan to Rise in Q1, 2026
According to a recent Morgan Stanley update shared by SCMP, the bank stated how it believes the Chinese Yuan may continue to spike high, riding the current market wave. The leading bank was quick to add details, adding how the rising export growth and crippling pressure on the USD could ultimately help the yuan bask in all glory for Q1, 2026. MG experts shared how Yuan’s outlook for Q1 2026 is bullish, with the currency rising 6.85 against the US dollar.
This sentiment was similar to the one that Goldman Sachs had issued as well, stating how the Chinese Yuan may end up ascending in a choppy manner.
“That said, when the dollar weakens, investors often seize the chance to position for a sharper (yuan) rally, leading to short-term overshoots and renewed policy management of the pace of appreciation. Taken together, this should result in a choppy trajectory ahead.” As quoted by SCMP.
The Dollar Down Phenomenon to Continue?
The US dollar is starting heavy exits as of late, with investors dumping USD to seek refuge in popular safe haven assets. This momentum has expedited as of late, with Venezuelan tension, coupled with the rising Iran conflicts, adding more uncertainty to the global markets. Moreover, the Powell indictment charges are also weighing on the dollar. These collective developments in general are taking a heavy toll on the dollar, resulting in the American currency exploring new lows.
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