Deutsche Bank and Morgan Stanley have raised their 2025 growth forecasts for China’s economy, anticipating long-term RMB appreciation. Deutsche Bank projects the USD/CNY rate to reach 7.0 by end-2025 and 6.7 by end-2026, maintaining a bearish view on the U.S. dollar amid expectations of rising Treasury yields.
Morgan Stanley cites three key factors for continued USD weakness: reduced safe-haven appeal amid policy uncertainty, increased hedging demand for dollar assets, and slower U.S. growth relative to other major economies. The bank expects these trends to persist through 2024-2025.
The upgraded forecasts reflect growing confidence in China’s economic resilience, with analysts noting the RMB’s potential to benefit from both domestic recovery and broader dollar weakness in coming years.
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