China Confuses Yuan Traders With Surprise Changes to Fixing
- Unclear where there’s a possible new line in the sand: Maybank
- Ambiguous messaging may help PBOC achieve its goals: StoneX
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Traders seeking to navigate the most crucial part of China’s foreign-exchange management are finding visibility getting increasingly cloudy.
Since last Friday, authorities have flipped backward and forward with their favorite tool for guiding expectations — the yuan’s daily reference rate, which pins the currency to a level around which it’s allowed to deviate just 2%. Policymakers first triggered a yuan selloff partially by weakening the rate, before causing a rebound via stronger settings in the next two days.