People’s Bank of China sets USD/CNY reference rate for today at 7.1020 (vs. estimate of 7.2281)

The People’s Bank of China has set the onshore yuan (CNY) benchmark rate for the upcoming trading session.

• USD/CNY is the national yuan. It is permitted to trade at plus or minus 2% of this daily reference rate.
• CNH is the offshore yuan. USD/CNH has no restrictions on its trading range.
• A rate that is significantly stronger or weaker than expected is generally considered a signal from the PBOC.

By setting the reference rate as far as the market, the PBoC is trying to support the weakness of the yuan.

Previous close was 7.2383

–

The PBOC injects 2 billion via a 7-day RR and sets its rate unchanged at 1.8%

• 2 billion yuan of RR matures today
• therefore net neutral the same day in OMOs

—

In People’s Bank of China news, Governor Pan met with IMF Managing Director Georgieva in Washington and exchanged views on cooperation between China and the IMF.