PBOC sets USD/ CNY reference rate for today at 7.1705 (vs. estimate at 7.2779)

The People’s Bank of China (PBOC), China’s central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a “band,” around a central reference rate, or “midpoint.” It’s currently at +/- 2%.

The previous close was 7.2846

PBOC injects 284bn yuan via 14-day RR, sets rate at 1.65%

• 105bn yuan mature today
• net injection is 179bn yuan

The longer than 7 days is the PBoC providing liquidity for the long holiday coming up (LUnar New Year).

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