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 7.2510
A much stronger than expected for the CNY. This is the fifth day in a row the PBC has set the CNY stronger than expectations. The Bank has been expressing its desire to slow the decline of the yuan.
PBOC injects 5bn yuan in open market operations (OMOs) via 7-day reverse repos (RRs) at an unchanged rate of 1.9%
- 440bn yuan of RRs mature today
- thus a net 435bn yuan drain on the day in OMOs
more to come
eur