Will the renminbi sink further this year?
The renminbi has declined more than 2 per cent against the dollar over the past month, breaking the Rmb7 per dollar level and hitting its weakest point since early December, when the country was still in the process of dismantling its throttling zero-Covid curbs.
The decline is in response to warnings from the US Federal Reserve that it may raise domestic interest rates further, while there are growing doubts over the sustainability of China’s economic rebound.
Analysts had expected a strong recovery following the unwinding of the country’s coronavirus restrictions last year. But weak Chinese economic data for April, including record youth unemployment and slower than expected industrial production and consumer spending growth, has clouded the outlook.