USD/CNY stable as Bessent sees 'good' trade position despite deficit

USD/CNY remains steady near 7.2850 following US Treasury Secretary Bessent's comments that the US is in a 'pretty good place' with China on trade, despite the significant bilateral trade deficit. In a Fox Business interview, Bessent indicated plans to discuss China's purchases of sanctioned oil from Russia and Iran, suggesting potential leverage in future trade negotiations. The remarks come amid ongoing concerns about the US-China trade imbalance, which reached $280 billion in 2023. Market participants view Bessent's diplomatic tone as potentially reducing trade war risks, keeping the dollar-yuan pair range-bound. Technical indicators show USD/CNY trading within a narrow 7.2800-7.2900 range, with traders awaiting more concrete policy developments. The measured approach from the Treasury could signal a shift from aggressive tariff threats to negotiated solutions, potentially limiting yuan volatility in the near term.