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CNH Slips as PBoC Raise FX Reserve Requirements

  • CNH slips in recent trade as markets respond to PBoC headlines:
  • PBoC are to raise the FX Reserve Requirement Ratio for financial institutions to 7% from 5%.
  • Move has prompted a need among Chinese financial institutions to diversify further away from CNY, CNH and into the likes of USD, EUR, hence modest China FX weakness across most major pairs this morning
  • Policy switch follows extended period of strength for CNY over the past few months, in which USD/CNY touched the lowest levels since 2018.
MNI London Bureau | +44 203-865-3809 |
MNI London Bureau | +44 203-865-3809 |

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