PBOC sets USD/ CNY reference rate for today at 6.9305 (vs. estimate at 6.9228)

People's Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.

• 6.9305 is the weakest onshore yuan setting since August 18 of 2020
• 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 6.9971

The PBOC injects 2 yuan via 7-day reverse repos (rate remains at 2.0%)

• 2bn yuan mature today
• thus a net neutral in OMOs today

---

The offshore yuan weakened beyond 7 to the USD.

• The USD is so strong, has been for months.
• Add in China capital flight flows (not a cascade yet but its building) as headwinds for the CNH against the USD.

-

eur EUR The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value Read this Term