People’s Bank of China (PBoC) set the USD/CNY central rate at 7.2054 on Friday, versus previous fix of 7.2098 and market expectations of 7.2423. It’s worth noting that the USD/CNY closed near 7.2489 the previous day.
With this, the Chinese central bank’s onshore Yuan (CNY) rate defends the week-start pullback from the yearly top.
Apart from the USD/CNY fix, the PBoC also unveiled details of its Open Market Operations (OMO) while saying that the Chinese central bank injects 2 billion Yuan via 7-day reverse repos at 1.90% vs prior 1.90%.
It’s worth noting that the 103 billion Yuan of RRs mature today, which in turn highlights a net drain of 101 billion Yuan via the OMOs.
About PBOC fix
China maintains strict control of the yuan’s rate on the mainland.
The onshore yuan (CNY) differs from the offshore one (CNH) in trading restrictions, this last one is not as tightly controlled.
Each morning, the People’s Bank of China (PBOC) sets a so-called daily midpoint fix, based on the yuan’s previous day’s closing level and quotations taken from the inter-bank dealer.
