August 10, 2026 (InvestinChina.asia) — The onshore renminbi closed at 6.7442 against the US dollar on Monday, 59 pips stronger than the previous session and the highest level since February 2, 2023. The central parity rate was fixed at 6.7884, 20 pips firmer and the strongest since February 10, 2023. Analysts attribute the move to a resilient export complex, persistent trade surpluses and accumulating corporate and household settlement demand — but caution that the second half of the year is more likely to bring two-way fluctuation than a repeat of the first half’s steady climb.
What moved the market
Wen Bin, chief economist at China Minsheng Bank, told Jiemian News that the primary driver of the yuan’s strength this year has been the high momentum in exports. With the trade structure continuing to optimise, he expects strong export growth and elevated trade surpluses to persist, laying “a solid foundation for the renminbi to remain basically stable at a reasonable and balanced level.” He forecasts that the exchange rate will hold a stable, two-way volatile pattern around 6.75 in August.
Wang Qing, chief macro analyst at Dongfang Jincheng, struck a similarly cautious note. While acknowledging that the drag from Middle East conflicts on the global economy will gradually surface, he warned that China’s external trade environment still carries uncertainties, and that the sustainability of the AI investment boom remains to be seen. With the dollar index expected to maintain the relative stability it has shown since the start of the year, Wang sees the renminbi trading inversely but with relatively small amplitude against the dollar in the second half — making a repeat of the first half’s sustained, rapid appreciation unlikely. He projects a trading range of 6.70 to 7.00 and characterises the full-year path as “appreciate first, then stabilise.”
The medium-term case for further strength
Not all observers are so guarded. A research note from Huaxi Securities argues that the renminbi remains in a medium-term appreciation channel. The broker cites four supporting factors: trade surpluses are expected to stay large; corporate and household settlement willingness is continuously releasing; expectations around the Federal Reserve’s policy path are becoming clearer; and domestic monetary policy expectations are stable, keeping the China-US rate differential in a relatively steady state. Huaxi sees the yuan moving toward 6.70 in the near term.
Liu Tao, a senior fellow at the International Finance Research Institute of the China Chief Economist Forum, takes the longest view. He argues that during the “15th Five-Year Plan” period and beyond, the renminbi faces a trend of strategic appreciation. Over the next five years, he expects the currency to appreciate moderately against the dollar amid fluctuations, driven by market supply and demand. For 2026, Liu projects the central parity rate to fluctuate within a 6.60–7.00 band, with the offshore yuan’s range potentially wider, overall displaying a pattern of “two-way fluctuation with moderate strengthening.”
The policy backdrop: stability, with elasticity
The People’s Bank of China, at its second-half work meeting on August 1, emphasised that it will continue to properly execute and supervise interest-rate policy. The central bank reaffirmed its commitment to letting the market play the decisive role in exchange-rate formation, maintaining exchange-rate flexibility, strengthening expectation guidance, and keeping the renminbi basically stable at a reasonable and balanced level.
The State Administration of Foreign Exchange (SAFE), at its own second-half foreign-exchange management work meeting, reported that China’s FX market has demonstrated strong vitality and resilience amid complex conditions in 2026, with the renminbi floating in two-way fashion and rising steadily, and cross-border funds maintaining a net inflow. For the remainder of the year, SAFE pledged to “build a breakwater against external shocks,” strengthen monitoring of cross-border capital flows, and continuously improve macro-prudential and expectation management to safeguard FX market stability through comprehensive measures.
Reading the signals
The convergence of views is telling. Even the more bullish houses — Huaxi Securities and Liu Tao — frame the renminbi’s trajectory as “moderate” and “two-way,” not as a one-way bet. The consensus that emerges from Monday’s commentary is a currency that has earned its strength through fundamentals: exports that continue to surprise, a trade surplus that refuses to shrink, and a corporate sector increasingly willing to convert its dollar earnings into local currency.
Yet the same analysts who celebrate the yuan’s 3-1/2 year peak are quick to remind readers that the easy appreciation may be behind us. With the dollar index expected to hold steady and external uncertainties — from geopolitical conflicts to the durability of the global AI capex cycle — still in play, the second half is shaping up to be a story of range-bound, two-way trading rather than a continuation of the first half’s steady march higher.
For Beijing, the policy stance is clear and consistent: a market-determined rate, kept flexible but anchored, with the full weight of the state’s macro-prudential toolkit ready to dampen excessive volatility. The renminbi at 6.74 is not a target to defend or an obstacle to overcome — it is, in the central bank’s framing, simply where the market has brought it, and where the market will be allowed to keep it.