PBOC sets USD/CNY reference rate for today at 7.1730 (vs. estimate at 7.3052)

<p>The People's Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.</p><ul><li>USD/CNY is the onshore yuan. Its permitted to trade plus or minus 2% from this daily reference rate.</li><li>CNH is the offshore yuan. USD /CNH has no restrictions on its trading range.</li><li>A significantly stronger or weaker rate than expected is typically considered a signal from the PBOC.</li></ul><p>The previous close was 7.2890.</p><p>I'm going to sound like a broken record, again … The difference between the modelled estimate and the actual is more than 1300 points today. The difference is the largest on record. The message from the PBOC remains that its not letting the yuan fall away any further for now. The 7.1730 is the strongest for CNY since August 14.</p><p>Meanwhile, the yuan is at its highest vs. its trade-weighted basket since May 29. Its up 0.11% on year. </p><p>PBOC injects 169bn yuan in open market operations (OMOs) via 7-day reverse repos (RRs) at an unchanged rate of 1.8%</p><ul><li>PBOC injects 82bn via 14 day RR, sets rate at 1.95%</li><li>110bn yuan of RRs mature today</li><li>thus a net 169bn yuan injection on the day in OMOs</li></ul>

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