Many factors favour the rise of China’s currency

The People’s Bank of China (PBoC), the country’s central bank, however, has not followed the common playbook and retains some room for conventional monetary policy, with the one-year benchmark lending rate, or the prime loan rate, coming in at 3.85% in August.

CHINA has a key window of opportunity to advance its pursuit of yuan internationalisation as global investors are seeking stability amid volatility in markets caused by the Covid-19 pandemic.

At present, most of the major economies have resorted to extremely low or even negative interest rates to cushion economic shocks caused by Covid-19. Financial assets with negative interest rates have been on the rise continuously in the world.