The CNY rate against Mongolian tugrik has been strengthening since 2019. According to the official rate announced by the Bank of Mongolia (BoM), yuan stood at MNT 398.51 on Wednesday. China has a bigger impact on Mongolia’s foreign trade. The South neighbor of Mongolia has reduced its yuan rate to decrease trade deficits and thus support exports. Particularly, China pursued monetary policies to overcome the trade dispute with the United States at a low cost.The yuan rate has relatively increased by MNT 13 over the past three months. In the meantime. Mongolia is planning to increase its trade turnover with China to USD 10 billion this year. However, if the yuan is still unstable, Mongolia may see a slight loss further. Domestic demand of China, which consumes half of the global commodity supply, had lightly weakened. At the same time, the People’s Bank of China has reduced the required amount of commercial banking stocks and expanded the cash flow to market to mitigate its economic slowdown. This has created inexpensive sources to support the business and provided up to USD 115 billion from its banking system.

Published Date:2020-01-17