Yuan Weakness Fuels DXY Rampage
The Chinese yuan has been the driving force behind the dollar's relentless surge. As USDCNH blazed a trail higher, the mighty Dollar followed suit.
But why is Yuan weakening? China's economic slowdown and policy divergence with the West are key culprits. As the yuan depreciates, the dollar index naturally strengthens. Add to the fact that China tries to close the gap between Yen depreciation.
USDCNH could be the canary in the coal mine, signalling the dollar's next move.