November 7, 2024 (Globalinvestorideas.com Newswire) Globalinvestorideas.com, a go-to platform for big investing ideas releases market commentary from Joseph Dahrieh, Managing Principal at Tickmill.
The Chinese yuan attempted to rebound following a significant decline after Trump’s re-election, as renewed fears over U.S.-China trade tensions weighed heavily on the currency. Trump’s campaign rhetoric and prior stance on high tariffs for Chinese goods have raised investor concerns that a fresh wave of trade restrictions could target Chinese exports. These concerns initially drove the yuan lower, with markets anticipating potential trade barriers from the U.S., China’s largest export destination. Given the uncertainty, the near-term outlook for the yuan could remain bearish.
However, the yuan’s partial recovery reflects investors’ confidence that China’s government may implement measures to stabilise its economy and counter external pressure. A recent increase in export activity has provided a short-term buffer for the currency, as exporters hurry to fulfill orders before potential tariffs take effect. Furthermore, expectations of an upcoming stimulus package suggest Beijing is prepared to support the yuan and mitigate trade-related shocks. These factors create a mixed near-term outlook.
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