Technical Analysis

PBOC sets USD/ CNY central rate at 7.1668 (vs. estimate at 7.1348)

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 7.2629

Weakest for the CNY setting since January 2008

PBoC injects 230bn yuan of 7-day reverse repos at an unchanged rate of 2.0%

2bn yuan of RRs mature today
thus a net 228bn yuan injection today

The offshore yuan was dumped (higher USD/CNH) on the fixing. USD/CNH hit a record high circa 7.3650:

AUD , NZD lower also

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