Latest / China Economy with Fexingo: Beijing's Policies, Trade, and Asia-Pacific Markets
How China's Widening Trade Deficit Is Testing Yuan Stability
China's trade deficit has ballooned to $77.6 billion in May 2026, a 42% jump from two months earlier. While exports remain robust, imports are surging even faster—driven by energy, chip components, and services like tourism. Lucas and Luna explore why the yuan has held steady at 6.77 per dollar despite the widening gap. They break down the PBOC's toolkit: capital controls, reserve requirements, and offshore market management. Is this stability sustainable, or is a devaluation brewing? A deep dive into the delicate balance between trade flows and currency policy.
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