29.04.202603:20:59UTC+00Offshore Yuan Remains Near 2023 Peak Levels

The offshore yuan traded around 6.83 per dollar on Wednesday, holding near its highest level in more than three years, even as it enters a period of typically seasonal weakness that may arrive earlier than usual this summer. Chinese companies are stepping up their foreign exchange hedging ahead of a record wave of dividend payments scheduled from June to August, with mainland firms listed in Hong Kong expected to distribute nearly $70 billion in payouts. Rather than waiting until closer to the payment dates, many are locking in exchange rates early, taking advantage of lower currency purchase costs and forward rates that are currently cheaper than the spot market.

The yuan is also facing headwinds from renewed US–China tensions, including Washington’s sanctions on a major Chinese refiner and warnings about potential secondary sanctions on banks. At the same time, China’s decision to block Meta’s acquisition of AI startup Manus, along with tighter export compliance and supply chain regulations, has added to investor caution and contributed to a more guarded outlook for the yuan.