Yuan Climbs for Second Day as Data Spur Bets Economy Recoveringby
Industrial profits grew faster in June than a month earlier
Traders await Fed statement for clues on interest-rate outlook
The yuan gained for a second day as economic data supported optimism that China’s growth is recovering.
Industrial profits climbed more in June than they did a month earlier, according to a report released Wednesday, following data earlier this month that had second-quarter gross domestic product and June retail sales beating forecasts. Traders are waiting for a Federal Reserve statement after its meeting this week for clues on monetary policy outlook.
The yuan rose 0.06 percent to 6.6709 a dollar as of 4:49 p.m. in Shanghai, according to China Foreign Exchange Trade System prices, as the People’s Bank of China strengthened its daily fixing by 0.16 percent. The offshore yuan climbed 0.06 percent to 6.6760. A Bloomberg replica of the trade-weighted CFETS RMB Index, which tracks the yuan against 13 currencies, was little changed.
"The market is now less concerned about the downside risks in the Chinese economy," said Aaron Chan, head of retail sales at ADS Securities Hong Kong Ltd. "The U.S. economy is doing OK, and everyone can accept that there could be one rate hike. This may stabilize the U.S. dollar, but it won’t cause it to surge."
The Citi Economic Surprise Index for the U.S. jumped to the highest since September 2014, and key reports including June’s new job creation and retail sales exceeded estimates.