HSBC revises USD/CNY forecasts higher

HSBC has revised its second quarter and third quarter USD/CNY forecasts higher, courtesy of increased US tariffs. 

The investment bank now sees USD/CNY at 6.95 in both the second and the third quarter as opposed to the previous prediction of 6.70 and 6.75, respectively. 

The analysts, however, have kept their year end forecast unchanged at 6.75 on the premise that there will be some moderation of trade tensions. 

The US hiked tariffs on $200 billion worth of China’s good from 10% to 25% last Friday. While China is yet to retaliate, the nation has warned the US not to underestimate its endurance to fight a prolonged war.