PBOC sets USD/ CNY reference rate for today at 6.3681 (vs. estimate at 6.3665)

• 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.

PBoC injects 20bn yuan via 7-day reverse repos in open market operations

• 200bn in RRs mature today

• thus a drain of net 180bn yuan (a withdrawal of cash liquidity Liquidity Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Liquidity refers to the extent of a financial instrument’s ability to be bought or sold without causing price fluctuations. Thus, if an asset is extremely liquid, it means one can trade that asset in the knowledge that one’s specific dealing won’t create significant movements in the market.This is because there exists such a large number of traders going both long and short, generating huge volume for that particular asset. Liquidity in the FX MarketTake the example of the foreign exchange marke Read this Term after the holiday)