No Reason For Long-Term Yuan Depreciation Against U.S. Dollar

There is no reason for the yuan to continue to depreciate against the U.S. dollar over the longer term given the steady recovery of the Chinese economy, the Securities Daily reported, citing analysts after both the onshore and offshore yuan breached 7.19 on Thursday. The U.S. Dollar Index is likely to remain high in the short term on expectations of further rate hikes by the Federal Reserve, though the index may have limited upside, the newspaper said citing Zhao Qingming, vice president of the China Foreign Exchange Investment Research Institute. The yuan may fluctuate in a narrow range around 7.1 by the end of the year, the Daily said citing Pan Zhongning, head of International Business at China Asset Management.