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PBOC’s Strong Fix Fails to Prop Up Yuan as Bearishness Extends

  • Reference rate at stronger-than-expected level for a 12th day
  • Central bank’s moves seen helping prevent panic selling
Bloomberg business news
MUFG Lin Li on Yuan, Asia FX Outlook

China’s central bank is failing to impress the group that it wants to influence the most with its fixings -- the yuan bears.

Investors are trading the yuan in the spot market at the largest discount since May to the reference rate, a sign that sentiment toward the Chinese currency remains poor despite Beijing’s push to restore confidence. The exchange rate marched almost half way through its allowed trading range on the weak-side of the fixing, meaning the central bank many need to use another strong rate in the next session to rein in the bearishness.