Economists at Commerzbank forecast CNY to appreciate mildly this year due to the tailwinds from Covid reopening.

Risks to growth and CNY remain significant

“Due to the Covid reopening and in anticipation of a weaker dollar later this year, we forecast CNY will continue to appreciate this year. But the pace of appreciation will be mild as we remain cautious about the speed of the economic recovery, especially in H2.”

“Confidence will be crucial to growth and the CNY path further down the road. But the degree to which confidence will be regained remains highly uncertain.”

“Meanwhile, the property slump will take time to turn around, and headwinds from global slowdown and US-China tensions will remain strong. Thus, risks to growth and CNY remain large.”