China’s central bank sets yuan reference rate above market expectations, signaling potential depreciation pressure amid regional volatility.
The People’s Bank of China set the USD/CNY reference rate at 6.8157, weaker than the estimated 6.7735. The move follows a two-day pause in liquidity injections, which forced banks to deploy idle cash reserves earlier this week.
Regional markets reacted sharply to geopolitical tensions, with South Korea’s KOSPI dropping 6% and the won hitting a 17-year low against the USD. Japan renewed threats of yen intervention after reserves fell by a record amount in May, though the currency showed little immediate response.
Goldman Sachs advised clients to buy US equity dips, citing risk appetite at its highest since 2021. Meanwhile, the Dow closed at a record high, while the NASDAQ index declined on the day.