China Central Bank Signals Renewed Action to Support the Yuan
- Move indicates policy makers are working to shore up currency
- U.S. has eyed yuan weakness as trade disagreements continue
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China’s central bank signaled that it’s taking action to support the yuan as trade tensions with the U.S. show no signs of ending soon.
Starting this month, banks resumed using an adjustment, known as the counter-cyclical factor, in the daily pricing of the currency against the dollar to counter the bias toward a weaker yuan, the People’s Bank of China said late Friday. China had suspended use of the factor in January, a move interpreted to mean that policy makers had grown more comfortable with the yuan’s trajectory after several months of gains against the dollar.