The Chinese yuan just hit a multi-year low, plunging to levels not seen since 2007. With trade tensions between the U.S. and China flaring up again—thanks to fresh rounds of tariffs—the currency took a sharp hit. Onshore, the yuan closed at 7.3498 per U.S. dollar, while its offshore counterpart briefly crashed to a record 7.4288 before staging a modest bounce back. The message from the markets? The trade war is far from over.
The euro has also been affected by the escalating trade tensions. Despite economic challenges within the Eurozone, the euro has remained relatively strong, partly due to the U.S. dollar's defensive stance amid tariff-induced economic concerns. Before the recent volatility, analysts at Danske Bank had expected the EUR/USD to retreat to 1.0000 on a 12-month view, citing the impact of U.S. tariffs and the Federal Reserve's monetary policy.
The Japanese yen and Swiss franc have strengthened as investors sought safe-haven assets in response to the trade war.
Conversely, risk-sensitive currencies like the Australian dollar and Canadian dollar have weakened.
The Australian dollar, in particular, is expected to face further pressure due to anticipated interest rate cuts by the Reserve Bank of Australia.
In Asia, Indonesia’s rupiah hit a historic low against the U.S. dollar, briefly falling to 17,000—surpassing its 1998 Asian Financial Crisis level—before recovering after central bank intervention. The drop was driven by escalating global trade tensions, including U.S.–China tariff battles, triggering risk-off sentiment in emerging markets and prompting caution among investors.
The U.S. dollar's outlook remains uncertain. While some forecasts suggest a potential devaluation in 2025, driven by expectations of Federal Reserve rate cuts, the dollar's performance will largely depend on the trajectory of trade relations and global economic conditions.
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News2025-04-11
Swiss Franc Surges Amid U.S. Tariff Escalation
The Swiss franc has experienced a significant surge, reaching a decade-high against the U.S. dollar, following President Donald Trump's announcement of increased tariffs on Chinese imports. This development has intensified market volatility and heightened demand for safe-haven assets.
Further reading on the Chinese yuan (CNY) - Guides, Reviews & News from our research team.
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