The yuan has lost nearly 5% of its value against the dollar this year and in recent weeks China's central bank has begun pushing back on the slide, fixing the currency's daily trading band at stronger-than-expected levels.
Some analysts suggest the stronger fixing is due to the "counter-cyclical factor" , a tweak to the formula for setting the trading band to give authorities more latitude.The yuan is not a fully-convertible currency and its onshore exchange rate is a managed floating rate. Spot dollar/yuan is allowed to trade 2% either side of a fixed midpoint each day.
The banks refer to the onshore yuan closing price from the previous day, overnight dollar movements or shifts in baskets such as the CFETS renminbi indextold Reuters that the banks were asked to apply the "counter-cyclical factor" to their calculations, and tweak their submissions to CFETS accordingly.First introduced in 2017, regulators said the CCF was an effort to better reflect supply and demand, and guide market participants to focus more on macroeconomic fundamentals.
It allows market-makers to discount the closing price, where it's deemed out of step with their expectations.It appears at times of yuan weakness. The CCF was abandoned in 2020 when the yuan rose sharply and authorities decided to let market forces play more of a role.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Explainer: How is extreme weather testing China's climate resilience?Dramatic swings between extreme heat and intense rainfall are testing China's ability to cope with increasingly wild weather, as high temperatures challenge power grids and water security while floods ruin crops and threaten urban populations.
Read more »
Barbie South China Sea map: Vietnam bans movie for illustration showing China's territorial claimState media have reported that Vietnam has banned distribution of the popular 'Barbie' movie because it includes a view of a map showing disputed Chinese territorial claims in the South China Sea.
Read more »
Barbie South China Sea map: Vietnam bans movie for illustration showing China's territorial claimState media have reported that Vietnam has banned distribution of the popular 'Barbie' movie because it includes a view of a map showing disputed Chinese territorial claims in the South China Sea.
Read more »
Barbie South China Sea map: Vietnam bans movie for illustration showing China's territorial claimState media have reported that Vietnam has banned distribution of the popular 'Barbie' movie because it includes a view of a map showing disputed Chinese territorial claims in the South China Sea.
Read more »
Barbie South China Sea map: Vietnam bans movie for illustration showing China's territorial claimState media have reported that Vietnam has banned distribution of the popular 'Barbie' movie because it includes a view of a map showing disputed Chinese territorial claims in the South China Sea.
Read more »
Barbie South China Sea map: Vietnam bans movie for illustration showing China's territorial claimState media have reported that Vietnam has banned distribution of the popular 'Barbie' movie because it includes a view of a map showing disputed Chinese territorial claims in the South China Sea.
Read more »