Yesterday's mid-rate setting for the onshore yuan was instructive. The People's Bank of China set the rate around a big figure lower than the estimate:
i.e the Bank did not devalue the yuan as much as was expected.
I posted yesterday on the concern the People's Bank of China have with capital flight out of the country.
A rapidly falling yuan would make capital flight more likely, hence the efforts of the Bank to slow the rate of decline of yuan.
The expectation for the rate setting from the PBOC today is 6.9076. I can't see them allowing that. Under 6.9 seems likely again today.
Offshore yuan, though, is sitting above the 6.9 level (for USD/CNH):
