Another huge discrepancy between the modelled expectation and the PBOC decision. Yesterday was a 10 big figure deviation, today also. The Bank is signalling it’d like to slow the pace of the yuan’s fall. State banks have been intervening to sell USD/CNY also:
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 7.2888
more to come
PBOC injects 98bn yuan in open market operations (OMOs) via 7-day reverse repos (RRs) at an unchanged rate of 1.9%
- 2bn yuan of RRs mature today
- thus a net 96bn yuan injection on the day in OMOs
The yuan is barely off its lows:
This article was written by Eamonn Sheridan at www.forexlive.com. Source