MARKET OUTLOOK - Yuan Continues to Face Pressure, Hitting 16-Month Lows

Forex - The yuan has fallen to its lowest level against the dollar in 16 months, coming under new pressure as strong U.S. data supports the USD and uncertainty over trade tariffs persists. The PBOC reaffirmed its support for the stability of the currency by setting the daily reference rate at its strongest level since April of last year on Tuesday. However, according to Maybank analysts, the yuan continues to face pressure amid rising concerns following Trump's inauguration. Analysts remain cautious on the yuan in the near term, noting that broad dollar strength is likely to solidify if U.S. employment data comes in stronger than expected. USD/CNY was last seen at 7.33, hovering around levels last seen in September 2023.