China’s Control of Daily Yuan Level at Degree Last Seen in 2010
- Volatility of daily reference rate collapses to near zero
- PBOC shrugged off yuan rally to keep fixing steady Monday
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China’s iron-clad grip on the yuan has reached a level unseen for well over a decade in its daily reference rate, raising the risk of a buildup of currency pressure that may one day have to be released.
The People’s Bank of China kept the so-called fixing for the managed currency little changed on Monday, not reacting to last week’s late rally in the yuan on the back of broad dollar weakness. The PBOC has kept such a tight range on the reference rate — its favorite tool for guiding the currency — that a gauge of its swings has collapsed to levels last seen in 2010.