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 7.2685
In open market operations:
- PBOC injects 2bn via 7-day RR, sets rate at an unchanged 1.8%
- 2bn mature today
- thus net neutral
Note that earlier the PBOC said that in addition to its daily open market operations in the morning, it will also carry out temporary OMO in the afternoon to manage liquidity in the banking system.
- PBOC will carry out temporary bond repurchase or reverse repurchase operations depending on the market situation during working days between 4p.m. and 4:20 p.m.