China Loosens Grip on Yuan by Weakening Fix Amid Dollar Strength
- PBOC is “bowing to reality” of stronger dollar, Westpac says
- State banks sold dollars to support onshore yuan: traders
Any changes in Beijing’s currency stability playbook may also spill over to other currencies amid broad dollar strength.
Photographer: Lam Yik/BloombergThis article is for subscribers only.
China unexpectedly weakened its yuan defense as pressure from a resurgent dollar and poor sentiment pushed it toward a policy red line.
The People’s Bank of China broke out of a holding pattern and set a weaker daily reference rate for the managed currency, implying some flexibility for it to depreciate alongside regional peers amid broad strength in the dollar. The offshore yuan slid as much as 0.3% to lowest since November in reactions to the so-called fixing.