Offshore Yuan Starts the Week Flat

The offshore yuan held steady to around 7.19 per dollar on Monday, halting two consecutive sessions of losses to start the week on a muted note, as investors assessed the People’s Bank of China’s daily midpoint fix. The central bank set the USD/CNY reference rate at 7.1322 versus 7.1371 in the previous session, a slightly firmer signal that reinforced Beijing’s preference for stability. Market participants also weighed the likelihood of additional policy support from Beijing to support growth and cushion the impact of US tariffs, after recent data showed weaker factory activity and slowing retail sales. Sentiment was further restrained ahead of this week’s loan prime rate decision, with expectations leaning toward an unchanged stance. On the global front, attention is turning to the Fed’s Jackson Hole meeting, where Chair Powell could pave the way for a September rate cut, while political watchers track a Trump-Zelenskiy meeting in Washington.