The 22-year-old, seeded 30th in Beijing, beat Moldovan-born Spanish player Cristina Bucsa 6-3 6-3 on Saturday, with world No 7 Pegula next up on Monday from 10am in the WTA 1000 event.
Bucsa, the world No 67, defeated former Wimbledon semi-finalist Donna Vekic 6-2 6-4 to set up a meeting with Raducanu.
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If Raducanu works her way through the draw, she could play world No 2 Swiatek in the quarter-finals.
Raducanu reached the round of 16 in last week’s Korea Open before losing in three sets to 2024 Wimbledon champion Barbora Krejcikova when she was unable to convert three match points.
She opted to skip Britain’s Billie Jean King Cup campaign to play in Seoul.
Pegula currently owns a 2-1 record over Raducanu, including 2-0 on hard courts. Whoever emerges from that tussle could face either 2019 champion Osaka or No 23 seed Marta Kostyuk in the last 16.
British pair Katie Boulter and Cameron Norrie exited the tournament following straight-sets defeats in Beijing.
Boulter, 29, was outclassed by Wimbledon and US Open runner-up Amanda Anisimova in round two of the women’s draw, losing 6-1 6-3.
Norrie lost 6-3 6-4 to Russian world No 18 Daniil Medvedev in the opening round of the men’s competition.
Former US Open champion Medvedev, who is seeded eighth, avenged defeat to Norrie in round one of this year’s French Open.
World No 1 Carlos Alcaraz has chosen to play in Japan this week rather than at the China Open in Beijing, meaning for once he is not on a collision course with Jannik Sinner.
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