Yuan To Regain Support When China Growth Returns: Guan Tao

The yuan will regain support with foreign capital returning should China successfully contain the epidemic and implement more precise and effective ways to manage the outbreak and introduces pro-growth policies soon to restore market confidence, wrote Guan Tao, former forex official and chief economist at BOC Securities in an article published on Yicai.com. The recent depreciation of the yuan was due to a correction amid the spillover risk of Russia-Ukraine conflicts, greater regulatory oversight of China's U.S.-listed overseas companies and a sharp rebound of local Covid-19 cases, said Guan. Guan dismissed the speculation that the central bank has intervened by setting the central parity weaker. The recent weakening of the yuan will help release some pressure to depreciate as the U.S. Federal Reserve tightens its policies, Guan said.