The offshore yuan strengthened to around 7.23 per dollar, recovering from a more than three-month low in the previous session, as traders reacted to a fresh wave of economic data.
Yuan recovers from three-month low
On Friday, China reported that retail sales growth in October far surpassed market expectations, marking the fastest pace since February, driven by support measures introduced by Beijing in late September. Additionally, the unemployment rate dropped to its lowest level in four months. While industrial production rose, it did so at a slower pace than expected, easing from September's four-month high.
Economic data impacted the currency
Meanwhile, new home prices declined for the 16th consecutive month in October, experiencing the sharpest drop since April 2015, despite Beijing’s efforts to stimulate the ailing property sector with mortgage rate cuts and reduced home-buying costs. In response, the central bank injected CNY 981 billion through seven-day reverse repos to offset maturing MLF loans and tax payments, marking the largest single-day cash infusion since 2020.
