The creator of the "Dollar Smile Theory" predicts that a U.S...

The creator of the "Dollar Smile Theory" predicts that a U.S. rate cut could trigger a $1 trillion repatriation of Chinese funds, leading to a 10% appreciation of the yuan.

With the year-end peak of corporate forex settlements approaching, China Securities expects $10 billion in settlements to support the yuan by 1,000 basis points.

However, Morgan Stanley believes that for large-scale corporate settlements to occur, the yuan would need to strengthen further to the 6.9 or 6.8 level, which is considered unlikely.