Société Générale forecast USD/CNY as high as 7.40

<p>Soc Gen on the sliding yuan, forecasting USD/CNY to 7.30 in Q3 of this year</p><ul><li>and to 7.40 in Q4 2023 &amp; Q1 2024</li></ul><p>SG say that </p><ul><li>Market enthusiasm about China’s reopening didn't last long</li><li>Even some of the more resilient indicators failed to mask the country’s structural problems. </li><li>market shrugged off the recovery and is more focused on structural challenges</li><li>this combination means the yean is likely to weaken further</li></ul><p>SG on the People's Bank of China:</p><ul><li>PBoC does not seem too concerned about the yuan weakness</li></ul><p>Which means that China's</p><ul><li>underwhelming growth outlook and rising expectations of further monetary easing could maintain downward pressure on the CNY for some time yet</li></ul><p>—-</p><p>A glance at the chart shows work is likely to be done (I drew in an area for this to the left) for now:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.