PBOC sets USD/ CNY central rate at 7.1112 (vs. estimate at 7.1120)

The People’s Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.

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

The previous close was 7.1170

In open market operations (OMOs):

• PBOC injects 1.2bn via 7-day RR, sets rate at 1.7%
• 472 bn mature today
• thus a net drain of 471bn yuan in OMOs

This article was written by Eamonn Sheridan at www.forexlive.com.