People’s Bank of China sets yuan reference rate at 7.1342 (vs. estimate at 7.2711)

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 7.2726

The reference rate at 7.1342 is the weakest (for CNY) since November 21 last year.

In open market operations:

• PBOC injects 2bn via 7-day RR, sets rate at an unchanged 1.8%
• 2bn mature today
• thus net neutral

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