US dollar index 19-month high and yuan fixing by PBOC, Digi Mart USA News: The US Dollar Index paused its rally after touching a 19-month high, and with the yuan’s central parity rate turning stronger against the dollar, both onshore and offshore RMB advanced in Asian morning trading on the 12th, rising past the 6.67-per-dollar level.
The People’s Bank of China strengthened the yuan’s daily fixing by 17 basis points, or about 0.03%, to 6.7174 per dollar on the 12th, a day after weakening it by 24 basis points. The onshore yuan (CNY) was last quoted at 6.6675, adding 0.09% after a 0.06% gain on the 11th, while the offshore yuan (CNH) stood at 6.6662, up 0.12%.
On November 2, the two rates had touched their strongest levels in about 54 months and 53 months, both since May 2022, with the offshore rate briefly climbing to 6.6426.
On the dollar side, the US Dollar Index edged down 0.06% to 102.848 in morning trading on the 12th after gaining a cumulative 1.23% over the previous two sessions. The index had touched 102.962 intraday on the 11th, its highest since April 10, 2025, about 19 months.
Market participants noted that stronger-than-expected US October inflation data continued to underpin the dollar, but profit-taking pressure emerged after the recent run-up.
US October core CPI rose 0.3% month-on-month and headline CPI 0.4%, both above market forecasts of 0.2% and 0.3%. Federal Reserve Governor Christopher Waller had said in London before the data release that if October core CPI rose 0.3% or more, a two-notch rate hike should be considered in December.
The data landed at exactly 0.3%, boosting bets on a half-percentage-point move, though a quarter-point hike remains the main expectation for now.
The hawkish mood spread to other major currencies. The Japanese yen weakened 0.69% to 159.84 per dollar in late New York trading on the 11th, approaching the 160-per-dollar threshold and hitting a roughly two-month low.
The euro fell 0.65% to $1.11, its lowest since May 2025, and the pound slipped 0.50% to around $1.33, near a two-week low. The US Dollar Index closed up 0.68% at 102.90 that day.
Dollar strength drew a different response in Seoul, where the South Korean won closed at 1,333.6 per dollar on the 11th, down 3.9 won from the previous session. The won had opened 6.0 won above the prior close before turning lower as dollar selling from foreign banks continued, with overseas investors who had bought dollars in the 1,350–1,360 range closing positions to limit losses.
Note: Yen and euro quotes are from late New York trading on the 11th; the won is the Seoul closing price on the 11th; the remaining figures are Asian morning quotes on the 12th.
On policy, the Federal Reserve remains divided. Vice Chair for Supervision Michelle Bowman said inflation pressures persist and more work is needed to bring inflation back toward the 2% target, but cautioned that further tightening must weigh the cost to rate-sensitive sectors.
Steve Englander, global head of G10 FX research at Standard Chartered, noted that Waller’s hawkish remarks first lifted the dollar and Treasury yields, shifting market focus from oil prices to inflation and Fed policy.
The near-term path of the yuan will depend on whether the US Dollar Index can hold above 102 and on upcoming inflation and employment data before the December Fed meeting. If expectations for a two-notch hike intensify, the dollar could retest its recent highs; if the rally stalls near its 19-month high, Asian currencies may see a technical rebound.
For export-oriented Taiwanese manufacturers, a steady yuan and won would help preserve pricing competitiveness, but the yen’s approach toward 160 could add price pressure on Taiwanese machine-tool and passive-component industries that overlap with Japanese competitors.
