|
NEW YORK, Feb. 24-- The Chinese yuan (CNY) has sharply appreciated against the greenback in the past week, wrapping up Friday's trade with a high of 6.71 per U.S. dollar and notching the largest weekly gains since Jan. 11. Analysts and industry insiders believed that market optimism across the board on potential progress to be made in China-U.S. trade relations, as well as the long-term resilience of the Chinese economy, has fueled the yuan's rally to pick up steam during the week. MARKET OPTIMISM ON U.S-CHINA TRADE RELATIONS A principal driver for the yuan hinged on upbeat market expectations and constant updates on this week's trade talks between China and the United States. The yuan started to rise on Monday, after the two sides agreed on Feb. 15 to hold a new round of economic and trade talks in Washington in the past week following the meeting in the previous week in Beijing, which both sides said had led to some progress. "An important factor explaining the recent CNY appreciation is the increased market confidence on U.S.-China trade talks and the prospects of a trade truce between both countries," Alejo Czerwonko, emerging markets strategist at UBS Global Wealth Management, told Xinhua. Investors and traders have turned into a risk-on sentiment, as hopes for easing the lingering trade tensions boosted their appetite for riskier assets. That has at the margin reduced demand for the U.S. dollar as a safe-haven currency. A weaker dollar has also underpinned the yuan's strength over the week. | 
