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 7.1581
PBOC injects 363bn via 7-day RR, sets rate at an unchanged 1.8%
- 663bn yuan of RRs mature today
- thus a net 300bn yuan drain on the day in Open Market Operations (OMOs)
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I posted earlier on the yuan being offered ever since Moody's action on Tuesday:
- China's state banks stepped in to support yuan Tuesday, Moody's downgraded China's outlook
- Further reports of Chinese state banks FX intervention to support yuan, selling USD/CNY
Update on offshore yuan:
