China’s yuan weakened on Tuesday as expectations of steep rate rises by the US Federal Reserve lifted the dollar, but moderating expectations for aggressive loosening by China’s central bank kept losses in check.
The US dollar index, which measures the greenback against a basket of its peers, touched new two-year highs on Tuesday, and was last at 100.935, as benchmark US Treasury yields hovered near their highest since late 2018.
Despite the dollar’s strength, the People’s Bank of China set the yuan’s daily midpoint rate slightly firmer at 6.372 per dollar before the market opened, from 6.3763 on Monday.
Spot yuan opened at 6.3700 per dollar and was changing hands at 6.3719 at midday, 53 pips weaker than Monday’s late close.
Shanghai stocks rise, Bluechip falls
China’s blue chips fell on Tuesday, while the Shanghai Composite Index gained after the authorities vowed to support the economy hit by the country’s worst domestic COVID-19 outbreak in two years.
In other moves:
- The CSI300 index fell 0.4 percent to 4,150.28 by the end of the morning session.
- The Shanghai index gained 0.1 percent to 3,199.30.
- The Hang Seng index dropped 1.9 percent to 21,111.61.
- The Hong Kong China Enterprises Index lost 2.4 percent to 7,208.93.
China urges policies to support catering, retail sectors
China’s state planner called on Tuesday for the implementation of policies to support the country’s catering and retail sectors.
Spending on new energy vehicles should also be supported, said Meng Wei, spokeswoman for the National Development and Reform Commission.
Data on Monday showed March retail sales contracted the most on an annual basis since April 2020 due to widespread COVID-19 curbs across the country.
Ant Group set for majority stake of payments platform 2C2P
Today marks a key milestone for #2C2P.
We are delighted to announce our strategic partnership with @AntGroup to accelerate digital payments adoption across Asia, and, upon completion of the deal, welcome Ant Group as our majority shareholder.https://t.co/yZKxiqnczf
— 2C2P (@2c2p) April 18, 2022
Ant Group, the fintech unit of China’s Alibaba Group, is set to become the majority investor in Singapore-based payments platform 2C2P as part of a partnership, the companies said on Monday.
The deal will lead to the integration of Ant’s Alipay+ payment service with 2C2P’s platform used by merchants in Asia, Europe, the Middle East and the Americas.
Ant has over the years deepened its presence in Southeast Asia by investing in and partnering with fintechs, and recently appointed a general manager for the region to ramp up growth outside of China.
“Through this complementary partnership with Ant Group, 2C2P will be connected to a much larger merchant base and be well-positioned to advance our international expansion strategy,” Aung Kyaw Moe, founder and chief executive officer of 2C2P, said in a statement.
Shanghai regulator summons e-commerce platforms
Shanghai’s market regulator said on Monday it had summoned 12 e-commerce platforms including Meituan and eleme.me over topics including price gouging during the epidemic.
Platforms were told to improve their management of delivery riders, and stop behaviors such as improper price increases by riders, the regulator said on its WeChat account.
(With inputs from Reuters)