PBOC Seeks to Temper Yuan Rally With Stable Daily Fix

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessPBOC Seeks to Temper Yuan Rally With Stable Daily FixChina’s central bank signaled a preference for slower gains in the yuan, setting the daily fixing at a broadly stable level that is much weaker than expected, after the currency climbed to a three-year high.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.46in7chvpc6[mu09)40xg5}q_media_dl_1.png Bloomberg(Bloomberg) — China’s central bank signaled a preference for slower gains in the yuan, setting the daily fixing at a broadly stable level that is much weaker than expected, after the currency climbed to a three-year high.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe People’s Bank of China fixed the reference rate at 6.7894 on Friday, versus 6.7892 Thursday. The gap between the rate and the average estimate in a Bloomberg survey of analysts and traders was the widest since early March.“PBOC sends its strongest signal yet against rapid yuan gains” and policymakers are likely increasingly uncomfortable with the pace of appreciation, Wee Khoon Chong, senior Asia Pacific market strategist at BNY, wrote in a note. Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThe offshore yuan was little changed at 6.7446 per dollar on Friday, after rising to 6.7440 overnight, the strongest level since February 2023. The onshore unit was still up 0.1%, extending gains into the third day. Yuan’s rally accelerated on Thursday, as the Federal Reserve’s decision to hold the interest rate unchanged weakened the greenback. Month-end flows were skewed toward dollar selling in the onshore yuan market on Friday, and there were dollar bids from major state banks that slowed the pace of yuan appreciation, according to traders, who asked not to be identified speaking on private matters.The yuan has strengthened over 3% to outperform all its Asian peers this year, supported by robust exports that have fueled dollar conversions and China’s resilience to energy shocks triggered by the Iran war. While the PBOC has generally guided the fixing stronger this year, officials have repeatedly emphasized that they prefer currency stability and warned against one-way bets on the yuan.The market broadly expects the yuan’s resilience to hold well for the rest of the year, and the sentiment is also underpinned by expectations that China’s President Xi Jinping will visit the US and meet with his counterpart Trump in September. In forecasts affirmed in recent weeks, Barclays Plc strategists said they expect the yuan to reach 6.65 per dollar by the end of the year, while LGT Bank AG is targeting the 6.6 level in the next 12 months.PBOC could be reluctant to induce more dollar selling at month end, thus stopping short of further strengthening the fixing, but the sustainability of such effort needs to be further confirmed, according to Khoon Goh, head of Asia research at Australia & New Zealand Banking Group. “I don’t think they are done with the appreciation trend. We will find out when August rolls around,” he said.—With assistance from Ran Li and Julia Zhong.(Updates with prices, ANZ comment)This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.