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China's Yuan To Sustain Rally On Capital Inflows

CHINA PRESS
MNI (Singapore)

Foreign capital inflows into China's A-share market are likely to sustain the rally in the yuan as market sentiment is boosted by the recovery of the economy, China Securities Journal reported. Amid a robust economic recovery, conversion of foreign exchange deposits is increasing and capital outflows from the bond market have slowed as the China-US interest spread narrows. The weaker U.S. dollar and capital inflows have lifted the the yuan against the dollar so far this year, and the yuan's daily fixing set by the central bank is approaching the strongest in 6 months. The currency is expected to strengthen this year even though there will be periods of two-way volatility.

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