Free Trial

Yuan Strengthens Despite PBOC Efforts


The PBOC fixed USD/CNY at 6.4883, in line with sell side estimates and around 38 pips higher than yesterday. The bank also injected CNY 75bn, well above the CNY 5bn injections seen over the past week.

  • However a weaker fixing for the yuan and a liquidity injection were not enough to dampen risk sentiment evident in the region, USD/CNH is last down 82 pips at 6.4889.
  • Some of the strength could be a delayed reaction to strong GDP and Industrial Production data yesterday, which saw a muted response at the time amid stronger USD narrative. China's GDP grew 6.5% in Q4, the making it the only major economy to expand last year. Industrial production has been at the heart of the recovery, factory output jumped a further 7.1% inQ4, after growing 5.8% in the previous quarter. Retail sales missed expectations, but most of the weakness was concentrated in the first half of the year.
  • Also on the wires Guo Shuqing, chairman of the CBIRC, has dismissed claims that China is distorting its economy through state monopoly capitalism, saying the accusations are a big "misunderstanding" of how its economy operates saying state run companies are essential for tax purposes.

To read the full story



MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.