What are USD to CNY forecasts?
Recent forecasts from FX analysts suggest that the USD to CNY exchange rate is expected to remain volatile in the short term. The USD has been firming against the CNY due to increasing economic tensions between the US and China, particularly after Beijing's decision to ban memory chips made by US tech company Micron. The increased bearish mood has also contributed to a rise in demand for the safe-haven currency, which has been another factor in the USD's gains.
However, despite its current strength, economists expect that the long-term trend for the USD is likely to reverse, possibly by 2023, as the Fed completes its current interest rate hikes cycle. As for the CNY, the recent slide past the key level of 7 per dollar is seen as an indication that the Chinese economy may be facing challenges in its recovery from the Covid-19 pandemic. This could have implications for various aspects of the economy, such as the cost of imports and the competitiveness of Chinese exports in international markets. However, it's also important to note that currency exchange rates are influenced by a multitude of factors, and a single movement of the yuan beyond a particular level does not necessarily provide a comprehensive picture of the overall state of the Chinese economy.