Yuan Rout Eases as PBOC’s FX Reserve-Ratio Cut Offers Relief
- Offshore yuan pares drop to lowest level since November 2020
- Move aims to lift banks’ capability to use FX funds: statement
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The yuan pared its biggest loss since 2015 after China took measures to bolster the currency.
The People’s Bank of China cut the amount of money that banks must set aside in reserve for their foreign-currency holdings, effectively increasing the supply of dollars in the domestic market. The central bank acted after the offshore yuan fell as much as 1.3% to 6.6092 per dollar, the weakest level since November 2020. It improved to 6.5755 as of 12:55 p.m. in New York, trimming its loss over the past five days to about 3%, still the biggest in almost seven years.