China's state banks sold USD for yuan, trying to prop up CNY

<p>China's currency has been on a fresh downward spiral since the beginning of the new year.</p><p>Earlier this week state banks were in the market selling USD/CNY ahead of 7.20 trying to support the currency. On Tuesday the offshore yuan (CNH) hit a 2 month low. </p><p>The People's Bank of China have been holding the reference rate much lower than modelled estimates, also trying to support the yuan. </p><p>The model estimate for today's reference rate:</p><ul><li><a href="https://www.forexlive.com/centralbank/pboc-is-expected-to-set-the-usdcny-reference-rate-at-71972-reuters-estimate-20240119/" target="_blank" rel="follow" data-article-link="true">PBOC is expected to set the USD/CNY reference rate at 7.1972 – Reuters estimate</a></li></ul><p> Around 0115 GMT (2015 US Eastern time) we get the reference rate for the day, which will once again be much lower than that modelled rate. </p><p>Onshore yuan update:</p>

This article was written by Eamonn Sheridan at www.forexlive.com.