Morgan Stanley projects USD/CNY to dip toward 6.70 in near term, then modestly rise to ~6.80 by mid‑2027.
The bank expects USD/CNY at 6.75 by end‑2026, revising previous 7.00 target, with 3‑4% CFETS Index appreciation by 2027.
Forecast hinges on continued strong Chinese export performance; PBoC may allow modest yuan appreciation but not use it to fix growth imbalances.
Morgan Stanley lifts China 2026/27 real GDP growth to 4.8%/4.7% and GDP deflator to 0.5%, citing AI‑driven supply‑chain competitiveness.