What’s ahead for the Chinese yuan (CNY)
Rolling regression analysis tells us the CNY regime may have shifted
Key takeaways
Key takeaways
- From 1994 to 2014, the Chinese yuan (CNY) was firmly under Chinese policymakers’ control and its behavior was relatively predictable for more than two decades. Since then, however, we have observed several double-digit, and surprising, moves up and down in the US dollar to CNY exchange rate (USD/CNY) in 2017-2018, 2018-2020, and 2020-2021.
- This article attempts to describe the past regimes in CNY, what the brand new CNY regime looks like, and what will happen to USD/CNY in the next couple of months and years. In short, we expect USD/CNY to be within 7 to 7.2 to the dollar range in a few months and values above 8 are not unthinkable in 2023 or 2024.
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