The People’s Bank of China (PBoC) fixed the yuan at 6.4589 to the U.S. dollars, according to the China Foreign Exchange Trade System, which operates the national foreign exchange market.
China only allows the yuan to rise or fall two percent on either side of the daily fix, to prevent volatility and maintain control over the currency.
“This is a reaction to the dollar weakness overnight and there’s not much in the way of policy intention to read into,” Ken Cheung, Hong Kong-based currency strategist at Mizuho Bank, reportedly said.
“The expectation for a stronger yuan fix was laid by the gains for the yen after the Bank of Japan announcement,” Patrick Bennett, a strategist at Canadian Imperial Bank of Commerce in Hong Kong, told the press in a report.
Carol May, Readers Bureau, Fellow
Edited by Jesus Chan
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