The Financial Times (FT) reported on Friday that China’s currency, the renminbi, had its biggest rally in 15 years, driven by increased foreign demand and “rising expectations that a Joe Biden victory in next month’s U.S. presidential election could help reset relations between the two superpowers.”
FT allowed that the big rally might also have been goosed by the National Day holiday in China, which suspended trading from September 30 to October 9. The result was the “onshore” yuan reaching 6.693 against the dollar, its highest value since it was tied to the U.S. dollar in 2005.
China also has a looser “offshore renminbi” that did not suspend trading for the holiday and rose somewhat less in value on Friday.
Much of the rally was attributed to increased foreign demand for Chinese products and increased tourism, as China claims to have fully controlled the Chinese coronavirus pandemic and has rebooted