Goldman Sachs is betting the Chinese yuan will strengthen. The bank projects a 4.5% appreciation against the US dollar, targeting a USD/CNY exchange rate of 6.50 by mid-2027. The catalyst: a high-stakes summit between President Trump and President Xi Jinping scheduled for May 14-15 in Beijing.
The forecast comes as the People's Bank of China sets the reference rate at 6.8961 on May 7, signaling controlled appreciation ahead of the talks. China's trade surplus with the US stands at $87.7 billion in early 2026, and analysts expect Beijing to increase imports of American goods as a bargaining chip. Goldman Sachs also projects 4.5% economic growth for China in 2026.
Crypto markets are reacting. Bitcoin rose 2% on the forecast, with analysts anticipating enhanced regulatory clarity for BTC and ETH under the Trump administration. The PBOC continues piloting its digital yuan for cross-border payments.
For forex traders, the Goldman forecast presents a clear thesis: go long if the summit produces results. But analysts warn of heightened volatility if negotiations falter, potentially hammering both forex and crypto positions.