Chinese Yuan Retreats From 3-Week High on Stronger US Dollar, Firmer PBoC Fix, But Misses Estimates
China's yuan pulled back from the three-week high of 6.7758 reached in the previous session as a stronger US dollar gained support from safe haven demand amid ongoing Gulf tensions. Prior to the market opening, the People's Bank of China set the yuan's central parity rate at 6.7972 per US dollar on Monday. Comparatively, today's fixing came 17 pips firmer than Friday's fixing of 6.7989 but 122 pips weaker than the Reuters estimate of 6.7850. At the time of writing, onshore yuan slipped 0.05% to 6.7793 against the dollar, and its offshore counterpart declined 0.08% to 6.78187 in the late Asian session. The spot yuan is allowed to trade at a maximum of 2% on either side of the fixed midpoint each day. The PBoC fixes matters for the US dollar because China manages the yuan against many currencies, but the dollar sits in the middle of most currency pricing. So any change in yuan management can also affect G20/USD pairs globally. The China Foreign Exchange Trade System RMB Index, which measures the yuan against major currencies, slips 0.30 points to 102.35, as per the latest reading on July 10. Fourteen currencies, including the Japanese yen and Russian ruble, are among the 25.
China's yuan pulled back from the three-week high of 6.7758 reached in the previous session as a stronger US dollar gained support from safe haven demand amid ongoing Gulf tensions.
Prior to the market opening, the People's Bank of China set the yuan's central parity rate at 6.7972 per US dollar on Monday.
Comparatively, today's fixing came 17 pips firmer than Friday's fixing of 6.7989 but 122 pips weaker than the Reuters estimate of 6.7850.
At the time of writing, onshore yuan slipped 0.05% to 6.7793 against the dollar, and its offshore counterpart declined 0.08% to 6.78187 in the late Asian session.
The spot yuan is allowed to trade at a maximum of 2% on either side of the fixed midpoint each day.
The PBoC fixes matters for the US dollar because China manages the yuan against many currencies, but the dollar sits in the middle of most currency pricing.
So any change in yuan management can also affect G20/USD pairs globally.
The China Foreign Exchange Trade System RMB Index, which measures the yuan against major currencies, slips 0.30 points to 102.35, as per the latest reading on July 10.
Fourteen currencies, including the Japanese yen and Russian ruble, are among the 25.