Analysis: Potential Trump Reelection Looms Over Weakening Yuan

The former U.S. president has indicated support for a strong greenback, which could add fuel to the dollar’s rebound

If Trump wins the U.S. presidential election and the Republican Party holds power in both the House of Representatives and the Senate, there is a significant chance that a 60% tariff on imports from China will be put into effect. Photo: AI generated

The yuan has weakened significantly against the U.S. dollar over the past month, with the spot exchange rate falling by around 2.3%. The decline shaved more than half the 4.5% appreciation recorded in the three months to late September.

External factors are the main cause behind the weakening yuan. After bottoming out late last month, the U.S. Dollar Index has rebounded 3.88% as of Friday.