Yuan Fixings Enigma Returns as PBOC Reverts to Currency Basket
- Reference rate is `as black-box as ever': ING's Condon
- Moves have become more volatile since the Lunar New Year
China Cuts Reserve Ratio in Latest Economic Boost
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The Chinese central bank’s yuan fixings are becoming more erratic as policy makers adjust it more freely versus the dollar, heightening the risk of surprises in the closely watched indicator.
The People’s Bank of China kept moves in its daily reference rates to a maximum 0.02 percent most days in the month leading up to the Lunar New Year break that began Feb. 7, after a run of declines spurred a $4 trillion global stocks sell-off in the first week of January. Changes have averaged about 0.1 percent in the two trading weeks since the holiday and Tim Condon, ING Groep NV’s head of Asia research, wrote in a Feb. 24 note that the fixings were "as black-box as ever."