People’s Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.
- USD/CNY is the onshore yuan. Its permitted to trade plus or minus 2% from this daily reference rate.
- CNH is the offshore yuan. USD /CNH has no restrictions on its trading range.
- A significantly stronger or weaker rate than expected is typically considered a signal from the PBOC.
The previous close was 7.2390
The People’s Bank of China with a stronger than expected rate for the yuan. Signalling more forcefully it’d like to slow the decline of the currency. I suspect they are not trying to put a floor under it, just to slow it still though. Offering up a buy the dip scenario for USD/CNH.
PBOC injects 193bn yuan in open market operations (OMOs) via 7-day reverse repos (RRs) at an unchanged rate of 1.9%
- 0bn yuan of RRs mature today
- thus a net 193bn yuan injection on the day in OMOs
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This article was written by Eamonn Sheridan at www.forexlive.com. Source