China’s central bank sets the daily yuan reference rate above market expectations, signaling potential currency adjustment.
The People’s Bank of China set the USD/CNY central parity rate at 6.7852, weaker than the 6.7219 estimate. The move allows the yuan to trade within a 2% band around the reference rate, influencing market liquidity and exchange dynamics.
Analysts had anticipated a stronger fix, reflecting recent dollar strength and offshore yuan movements. The PBOC also injected 386 billion yuan via 7-day reverse repos at an unchanged 1.4% rate, maintaining liquidity support.
Asian equities opened lower following the announcement, with South Korea and Japan both declining in early trading.