FX.co ★ Offshore Yuan Hits Over 1-Month High

The offshore yuan strengthened to around 6.76 per dollar on Monday, its highest level since mid-June, as easing geopolitical tensions in the Middle East reduced safe-haven demand for the US dollar. US Ambassador Mike Waltz said President Trump had halted planned strikes on Iran for a second straight night to allow room for diplomacy, while an Iranian military spokesperson indicated that Tehran had suspended its retaliatory operations. These developments suggest a tentative de-escalation following nearly two weeks of tit-for-tat attacks that had effectively unraveled the June ceasefire.

On the domestic front, investors are now focused on the upcoming Politburo meeting later this week, where President Xi Jinping and other senior policymakers are expected to set priorities for the second half of the year. Expectations for additional policy support have risen after recent economic data highlighted an uneven recovery, strengthening calls for measures to shore up growth and stabilize demand.