PBOC sets USD/ CNY reference rate for today at 7.1798 (vs. estimate at 7.3239)

<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 7.3130</p><p>Yet another massive divergence between the modelled estimate and the actual. The daily reference rate seems to be stuck on the 7.17 big figure – the People's Bank of China is determined to slow the yuan's fall. </p><p>PBOC injects 508bn in open market operations (OMOs) via 7-day RR, sets rate at 1.80%</p><ul><li>PBOC injects 105bn in open market operations (OMOs) via 14-day RR, sets rate at 1.95%</li></ul><ul><li>169bn yuan of RRs mature today</li><li>thus a net 440bn yuan injection on the day in OMOs</li></ul><p>The injection will be helpful in providing liquidity over the week-long holiday coming up:</p><ul><li><a href="https://www.forexlive.com/news/china-golden-week-holidays-coming-up-surging-travel-will-boost-demand-for-oil-20230925/" target="_blank" data-article-link="true">China Golden Week holidays coming up – surging travel will boost demand for oil</a></li></ul><p>China is on holiday from Friday. There will be no reference rate setting tomorrow and all next week. </p>

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