FX.co ★ Offshore Yuan Holds Firm at 2023 Peak

The offshore yuan held its gains around 6.74 per dollar on Wednesday, remaining at its strongest level since early February 2023 as improving prospects for a renewed Middle East agreement bolstered risk sentiment. Qatar said mediation efforts between the US and Iran had entered an advanced phase, with a draft agreement already prepared. US officials indicated growing confidence that a deal could be reached soon, fueling hopes for the reopening of the Strait of Hormuz.

On the domestic front, a private survey showed that China’s Composite PMI fell to a one-year low of 50.8 in July 2026, signaling a broad loss of momentum in the economy. The manufacturing PMI slipped to a four-month low of 50.9, while the services PMI weakened to 50.4, its lowest level in nearly two years.

Meanwhile, the People’s Bank of China conducted a CNY 500 billion three-month outright reverse repo operation to ensure ample liquidity in the banking system, with bids allocated through a multi-tier interest-rate pricing mechanism.