When China’s currency “cracked seven” for the first time since the global financial crisis, some analysts fretted that US-China trade tensions risked spilling over into all-out economic warfare.

But the renminbi has rebounded in the months since it slid past the important seven to the dollar mark last August, which prompted the US Treasury to brand China a “ currency manipulator”. That rally continued on Wednesday after Washington deemed Beijing was no longer guilty of any forex funny business, with the renminbi hitting a more than five-month high against the greenback.

Strategists are now trying to figure out the next stage for the red-hot renminbi. Some warn that the rally could fade as long as a more comprehensive trade deal between the world’s top two economies remains out of sight. “I think year-end 2020 is going to see the renminbi not that much stronger than it is right now,” said Hannah Anderson, a global markets strategist at JPMorgan Asset Management in Hong Kong.