Yuan Official Exchange Rate at 7.1293 Yuan... Lowest Value Since February 2008 (Update)

[Asia Economy Beijing=Special Correspondent Sunmi Park] The yuan has depreciated to its lowest level since February 27, 2008.

On the 26th, the People's Bank of China announced the yuan's official central parity rate against the dollar at 7.1293 yuan, up 0.12% from the previous trading day. This official rate is the highest since February 27, 2008, breaking the record set the day before. This means the yuan's value against the dollar has fallen to its lowest level in over 12 years.

The previous day showed a sharp yuan depreciation, the largest drop since April 16. Since the yuan exchange rate traded in the foreign exchange market can fluctuate within a 2% range above or below the official central parity rate, the rate announced by the People's Bank of China serves as the benchmark for exchange rate movements.

The yuan's weakness reflects the deepening conflict between the US and China as China pushes forward with the 'Hong Kong National Security Law' (Hong Kong Security Law). The intensified US-China tensions, described even as a 'new Cold War,' have led to risk aversion in the foreign exchange market, resulting in a stronger dollar and yen, and a weaker yuan. Last year, when the US-China trade war peaked in August, the yuan's depreciation accelerated sharply, eventually breaking the psychological support level of '1 dollar = 7 yuan' in the foreign exchange market.

If the yuan's depreciation continues at the current pace, it is likely to surpass 7.2 yuan per dollar soon. Zhou Hao, an economist at Commerzbank, said, "The People's Bank of China is likely paying close attention to whether the yuan breaks through 7.2 per dollar," adding, "Depending on how US President Donald Trump responds to the Hong Kong issue, the yuan's volatility is expected to increase for the time being."

This content was produced with the assistance of AI translation services.