What Fed policy shift strengthened the yuan against the dollar?

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The Federal Reserve Signalled an End to Monetary Tightening, Strengthening the Yuan

The Federal Reserve's indication of an end to its monetary policy tightening cycle led to a strengthening of the yuan against the US dollar. This shift occurred as the Fed held US interest rates steady and its policymakers removed projections for further rate increases this year, anticipating an economic slowdown. Consequently, China's central bank adjusted its official yuan midpoint to its strongest level in eight months.
Fed Signals End to Rate Hikes

Federal Reserve policymakers have indicated that they do not expect to raise US interest rates further this year. This decision comes as the central bank foresees a potential slowdown in the economy. This signals a pause in the tightening of monetary policy that has been in place.
Interest Rates Held Steady

The Federal Reserve decided to maintain its current interest rate levels, opting not to implement any further increases. This move reflects a change in the Fed's stance on monetary policy. The decision was made in conjunction with the abandonment of projections for additional rate hikes in the current year.
Yuan Midpoint Reaches Eight-Month High

In response to the Federal Reserve's policy signals, China's central bank raised the official yuan midpoint to 6.6850 per dollar. This level represents the strongest valuation for the yuan against the dollar in eight months, surpassing the previous fix of 6.7101 by 251 pips. The adjustment aligns with the overnight losses experienced by the US dollar.

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What Fed policy shift strengthened the yuan against the dollar?

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