Analysts See Two-Way RMB Moves in H2 2026 After H1 Gains Despite Stronger Dollar

The onshore yuan strengthened about 2.9% against the U.S. dollar in the first half of 2026, rising to around 6.79 per dollar from about 6.98 at the start of the year, even as the U.S. dollar index climbed nearly 3%, according to Jiemian News. The CFETS RMB Index also rose to 102.59 from 98, up 4.7%.

Analysts interviewed by Jiemian said the drivers that supported the yuan in H1—strong exports and exporters’ FX conversion—may weaken at the margin in H2, while the Federal Reserve’s hawkish stance could add pressure, making a one-way appreciation trend harder to sustain. They expect the yuan to trade with two-way volatility in H2, with limited depreciation room.

China’s customs data showed China’s exports (in U.S. dollar terms) rose 15.5% year-on-year in January–May, 10 percentage points faster than the full-year pace in 2025; April and May export growth was 14.1% and 19.4%, respectively. Zhang Ming, deputy director at the Institute of Finance and Banking of the Chinese Academy of Social Sciences, said a rebound in external demand helped lift China’s current account surplus to $184.1 billion in the first quarter.

On the external backdrop, Zhang said he previously expected the dollar index to fluctuate in a 95–100 range in 2026, with USD/CNY in a 6.7–7.1 range, but now sees the dollar index potentially swinging between 97 and 103 in H2. He cited U.S. CPI rising to 4.2% in May from 2.4% in January and core CPI rising to 2.8% from 2.5%, and said markets have shifted to pricing in a 25–50 basis point Fed rate hike in H2. Huatai Futures researcher Cai Shaoli said the dollar index would likely need to hold in the 102–103 range to drive a marked yuan depreciation; at the time of reporting, the dollar index was 100.96.

Shenwan Hongyuan analyst Zhao Wei said exporters’ accumulated FX conversion demand since 2023 was about $400 billion, which could help cushion downside pressure on the yuan even if conversion momentum slows.