China's yuan could get a boost as Covid measures ease, says BK Asset Management

"We're conscionable opening to spot the betterment successful the currency," Kathy Lien, managing manager of FX strategy astatine BK Asset Management told CNBC's "Street Signs Asia" connected Thursday. She said the Chinese currency could fortify adjacent further to 6.8 against the U.S. dollar.

The currency weakened past 7.3 against the greenback successful aboriginal November, its weakest since January 2008. However, it rapidly recovered to 6.96 wrong astir a period arsenic Chinese wellness authorities continued to denote further easing measures.

"Investors are underpricing the robustness of the imaginable betterment implicit the adjacent mates of months," Lien told CNBC, up of the scheduled merchandise of a slew of Chinese economical information adjacent week, which includes concern accumulation and retail sales.

"We're going to spot what is depressed Chinese data, crook into what is much accordant upside surprises," she said. "That volition renew the request for the Chinese yuan and thrust the yuan adjacent higher than it is close now."

China's pivot distant from its zero-Covid argumentation has played an important portion successful optimism astir its recovery.

Beijing has been rolling backmost the restrictions "pretty quickly," and the surge successful request for the yuan comes with a sooner-than-expected easing measures, Lien said.

HSBC's main economist for greater China Jing Liu said the lifting of restrictions volition boost maturation further.

"The enhanced relaxation of COVID-19 measures, unneurotic with much proactive fiscal and accommodative monetary policies, whitethorn assistance to technologist maturation of supra 5% successful 2023," she said, adding that the latest adjustments successful argumentation volition "pave mode for further relaxations."

Lien of BK Asset Management said clarity successful China's wellness measures going guardant is what could thrust investors backmost to the Chinese market.

"There was a batch of uncertainty implicit the past months, peculiarly implicit the past mates of weeks, astir however China would grip the protests," Lien said.

"A batch of businesses person started to rethink their plans and I deliberation everyone anticipated a longer play of zero-Covid policy," she added.