The 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 7.1529

PBOC injects 65bn via 7-day RR, sets rate at an unchanged 1.8%

  • 222bn yuan of RRs mature today
  • thus a net 157bn yuan drain on the day in OMOs

ps. The yield on China's 10 year government bond has fallen below 2.5%, its lowest since April 2020.

I posted earlier on:

But, they may not have much choice at this rate.