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Offshore Chinese Yuan Plunges to Five-Year Low Against Dollar

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The Chinese yuan plunged to a five-year low in offshore trading and the gap between it and its mainland counterpart widened sharply on Wednesday, reflecting growing expectations of further weakness in the currency as China’s economy slows and capital outflows accelerate amid a stock slump.

The offshore yuan slumped to 6.6650 against the dollar, the lowest rate since the last quarter of 2010. The onshore yuan rate was 6.5418 against the dollar.

The latest trigger for the slump came after the People’s Bank of China (PBOC) set the official dollar/yuan midpoint rate at 6.5314, the weakest fixing since 2011. The fix represented a 0.22 percent decline from the previous session, a faster pace than witnessed recently.

CNBC

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.
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