FX.co ★ Offshore Yuan Snaps 3-Session Gains

On Thursday, the offshore yuan depreciated to about 7.10 against the US dollar, ending a three-day upward trend following its recent peak, which was the highest in over ten months. This reversal was attributed to a resurgence in the US dollar, as investors re-evaluated the Federal Reserve's cautious approach to potential future rate reductions. On Wednesday, the Fed implemented a 25 basis point rate cut, as was widely anticipated. However, Fed Chair Jerome Powell described the move as a "risk-management" strategy in light of a weakening labor market, which tempered expectations for more aggressive monetary easing and, in turn, bolstered the dollar.

In China, Vice President Han Zheng announced intentions to enhance the free trade agreement with ASEAN amidst ongoing trade tensions with the United States. At the China-ASEAN Expo in Nanning, he underscored the importance of strengthening cooperation with the 10-member group. Economically, China's fiscal revenue experienced a 0.3% year-on-year increase in the first eight months of 2025, a slight improvement from the 0.1% growth reported for the January to July period, as per the Finance Ministry's data.