Exclusive-Chinese Banks Boost Dollar Deposit Rates, Sources Say, as Beijing Seeks to Smooth Yuan Rally

The hikes are an extension of a months-long rise in dollar deposit rates in China.

But the latest ⁠moves, which have not ⁠been previously reported, show the trend gaining speed, signal an end to a de facto cap on state banks’ dollar ​rates and suggest efforts to slow down the rising yuan are stepping up.

Reuters could not determine whether policymakers had directed banks to raise dollar deposit rates. The People’s Bank of China, which typically issues informal guidance on such rates to state banks, did not respond to a faxed request for comment.

The hikes come amid some of the strongest efforts yet to rein in a yuan rally that has lifted the currency about 10% against the dollar ​since early 2025, with the PBOC on Tuesday announcing it would raise the foreign currency reserves banks must hold.

“The current exchange rate is not particularly favourable for exporters,” said one ⁠person ⁠at a state bank, where they said ⁠deposit rates rose by about 80 basis points ​over the past few months to as high as 4.5% in late October.