The Chinese renminbi, or yuan, is expected to see a prolonged trend of strengthening against the U.S. dollar amid forecasts that the Federal Reserve (Fed) may start to lower interest rate, said a Chinese expert in an interview with China Global Television Network (CGTN) on Thursday.
As of Friday, the central parity rate of the Chinese yuan has strengthened 11 pips to 7.1449 against the U.S. dollar, according to the China Foreign Exchange Trade System.
"I think we have to keep in mind that the yuan has been experiencing a devaluation for a very long time, for a very long time. I remember it has depreciated (against the U.S. dollar) from, you know, 6.5, something less than 6.5, all the way to close to 7.3. That's a very significant depreciation. And now we start to see that the tide may be turning in a very significant way as the rate in the United States is starting to decline. So, I think we are probably seeing the very beginning of a fairly prolonged trend of yuan strengthening in my view. So, I think this is really the tipping point at this time. And I would expect that, aided with the very encouraging news on the export sector, on the trade surplus dimension, I would expect that the yuan would further appreciate for a little bit more, maybe breaking the seven point mark, in my view," said John Gong, economic professor of China's Economics, University of International Business and Economics.
Experts believe the yuan's appreciation has been driven by market expectations that the Fed may start to lower interest rate in September, and the less-than-expected U.S. economic data in manufacturing PMI and unemployment rate.
The appreciation of yuan is also closely related to the recent strong rebound in Asian currencies such as the yen, as some insiders hold. But with China's domestic policies starting to take effect and the landing of Fed's rate cut, sharp unilateral appreciation may seem less likely.
Chinese yuan to see prolonged trend of strengthening: expert
A young Canadian man's tea-drinking habit has sparked a deep interest in Chinese culture, leading him from academic research to learning Mandarin, reading Tang poetry and traveling to China.
Gareth grew up with childhood memories of Toronto's Chinatown, one the biggest Chinatowns in North America.
The initial exposure to Chinese culture he gained from spending time there in his early years would later form a foundation for a life-changing pursuit, which began with a cup of tea.
"As a child, my impression of China was very surface level. I guess from going to Chinatown, I was familiar with the food and the smells and the sights, but I didn't really understand the culture on a deeper level. Chinatown was part of my upbringing, but I hadn't engaged with Chinese culture fully or more deeply until later. The moment I was introduced to Chinese tea culture was about five years ago, through my roommate in first year university. After trying different Chinese teas, I thought, the taste is so different," said Gareth.
The more the young man learned about Chinese tea, the more he was drawn to the craftsmanship and history behind it.
"As tea became part of my everyday life, drinking it every day, it definitely makes me slow down, paying attention to the water, the leaves, the timing, the taste. It gives you an opportunity to reflect. For me, Chinese tea is more than just a drink, it's a means to connect production, farming, geography, etc. and spend time talking with people and to slow down," he said.
Gareth turned that interest into academic research, looking at how tea production is linked to regions and climate.
"About two years ago, I would say tea became more than just personal interest, but sort of reached into academic territory because I found myself spending so much time reading about tea anyway in my own free time. I figured I might as well research this formally. And so I wrote a research paper under one of my supervisors about two years ago, sort of focusing on the different production methods and regions of tea and how the climate is linked into that. There's sort of that climate influence where the tea is affected by if it's rained, if it hasn't rained, or the total precipitation for the year, temperature swings," said the tea enthusiast.
Driven by a love of tea that deepened his scholarship of Chinese culture, Gareth saw learning Chinese as a powerful gateway to broadening his studies, and once he could read the language, Tang poetry drew him in with its rhythm and imagery.
"After I started learning Mandarin, I became more interested in poetry. I started with Tang poetry, and although I'm still learning Mandarin, I really find it interesting how so much rhyme and meter and imagery can all be combined into such a short poem. I think both poetry and tea force me to slow down and take a minute to reflect not only on myself, but on my surroundings and what's going on in my life and the world at that moment," said Gareth.
Last autumn, Gareth had an opportunity to visit China. He saw the landscapes of south China's Guangxi Zhuang Autonomous Region and experienced the warmth of the local people's hospitality.
Now, he hopes to go to southwest China's Yunnan Province to see firsthand how tea is cultivated, and to help more of his fellow Canadians experience China for themselves.
"For me, China started with a cup of tea, but since then it's become much more. It's an integral part of my life that I'll always continue to learn about for myself. But I think I'd like to expand that into the broader community here in Toronto, in Canada so that more Canadians can experience China for themselves. For me, China started with a cup of tea, but since then it's become much, much more than that," he said.
Cup of tea sparks Canadian youth's studious journey into Chinese culture
