China's offshore yuan jumps to its strongest level since October

pulse

May 31, 2017 1:25 PM

The offshore yuan just touched its strongest level against the dollar since October.

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The currency was up by 0.9% at 6.7611 per US dollar at 8:09 a.m. ET.

The offshore yuan has climbed 1.6% since Moody's cut its rating on China's debt a week ago, Bloomberg noted.

"Spurred in part by a funding squeeze in Hong Kong, the offshore yuan (CNH) has rallied 1.5% in the same time," Marc Chandler, global head of currency strategy at Brown Brothers Harriman, said.

The onshore yuan (CNY) is traded on mainland China, while the offshore yuan (CNH) is traded outside the mainland. The key difference between the two is that the CNH does not fluctuate within a tight band like the CNY, and it is free of China's controls.

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