The offshore yuan traded in Hong Kong yesterday rose for the first time in three days on optimism that the IMF plans to add China’s currency to its reserves basket this year.
An IMF team is visiting China to hold technical discussions over including the yuan, an IMF spokesperson based in Beijing on Saturday told Bloomberg in an e-mail.
The delegation is scheduled to meet People’s Bank of China (PBOC) officials to explore operational requirements if the currency is included, according to a person familiar with the matter.
China has appointed yuan-clearing banks in 11 cities around the world in the past year in an effort to push its use overseas.
“The yuan won’t depreciate sharply in the next six months as the government promotes its global use,” China Merchants Bank Co (招商銀行) Shanghai-based senior analyst Liu Dongliang (劉棟樑) said. “The authorities prefer a stable yuan also because they want to maintain market confidence and prevent capital outflows.”
YUAN RISING
The offshore yuan, which trades freely, climbed 0.04 percent to 6.2136 per Hong Kong dollar as of 11:02am, according to data compiled by Bloomberg. The spot rate in Shanghai, which is constrained to moves of a maximum 2 percent on either side of a central bank fixing, was little changed at 6.2089, China Foreign Exchange Trade System prices show.
The PBOC set its daily reference rate at 6.1169 yuan to the HK dollar, compared with Friday’s rate of 6.1167. The gap between the onshore yuan and the fixing rate was 1.5 percent.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to