{"id":1657588,"date":"2022-09-26T03:51:34","date_gmt":"2022-09-26T07:51:34","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1657588"},"modified":"2022-09-26T03:52:03","modified_gmt":"2022-09-26T07:52:03","slug":"chinas-yuan-hits-28-month-low-despite-fresh-policy-step-nears-daily-down-limit","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/chinas-yuan-hits-28-month-low-despite-fresh-policy-step-nears-daily-down-limit\/","title":{"rendered":"China\u2019s yuan hits 28-month low despite fresh policy step, nears daily down-limit"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">24<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fchinas-yuan-hits-28-month-low-despite-fresh-policy-step-nears-daily-down-limit%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1657588&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>SHANGHAI (Reuters) \u2013     China\u2019s yuan touched a 28-month low against the dollar on Monday, only steps away from its downside trading limit, despite the central bank taking steps to rein in the currency\u2019s weakness.<\/p>\n<p>The People\u2019s Bank of China (PBOC) said it would raise the foreign exchange risk reserves for financial institutions when purchasing FX through currency forwards to 20% from the current zero, starting on Sept. 28.<\/p>\n<div id=\"div-gpt-ad-1663871513696-art-1\">\n<\/div>\n<p>The announcement, along with another firmer-than-expected daily midpoint fixing, was meant to slow the pace of yuan depreciation by making it more expensive to bet against the currency, traders said. <\/p>\n<p>\u201cThis could stem further forward positions that have been negative for the yuan and slow its depreciation pace,\u201d analysts at Maybank said in a note. <\/p>\n<p>Prior to market opening, the PBOC set the midpoint rate at 7.0298 per dollar, 378 pips or 0.54% weaker than the previous fix of 6.992 on Friday, the weakest since July 7, 2020.<\/p>\n<p>However, the midpoint continued to come in much stronger than market projections for the 23rd straight trading session, traders and analysts said. <\/p>\n<p>The official daily midpoint fixing limits the onshore yuan to trade in a narrow range of 2% above or below, and Monday\u2019s guidance kept the range to between 6.8892 and 7.1704.<\/p>\n<p>The onshore yuan opened at 7.1400 per dollar and weakened to a low of 7.1690 at one point, the softest level since May 27, 2020 \u2013 mirroring broad falls in other currencies amid a sweeping rally by the dollar thanks in part to the U.S. Federal Reserve\u2019s rapid tightening of monetary policy. <\/p>\n<p>It was changing hands at 7.1662 at midday, 364 pips weaker than the previous late session close. And the midday level was 42 pips away from the lower end of the trading band.<\/p>\n<p>\u201cThe market is almost hitting the limit,\u201d said a trader at a foreign bank.<\/p>\n<p>Still, market participants believe more policy actions would be rolled out should the yuan\u2019s weakness persists.<\/p>\n<p>\u201cGiven the weak CNY level, it is likely that PBOC would roll out measures to remove market\u2019s one-side depreciation of CNY against the U.S. dollar in the near term,\u201d said Li Lin, head of global markets research for Asia at MUFG Bank.<\/p>\n<p>Li expects further cuts to the amount of foreign exchange banks must hold as reserve, after a reduction earlier this month.<\/p>\n<p>By midday, the global dollar index hovered around its two-decade high of 113.996 at midday, while the offshore yuan was trading at 7.1704 per dollar. <\/p>\n<p>The yuan market at 0401 GMT: <\/p>\n<p>ONSHORE SPOT:<\/p>\n<p>           Item               Current  Previous  Change          <\/p>\n<p>           PBOC midpoint      7.0298   6.992     -0.54%          <\/p>\n<p>           Spot yuan          7.1662   7.1298    -0.51%          <\/p>\n<p>           Divergence from    1.94%                        <\/p>\n<p>           midpoint*                                       <\/p>\n<p>           Spot change YTD                       -11.32%          <\/p>\n<p>           Spot change since 2005                15.49%          <\/p>\n<p>           revaluation                                     <\/p>\n<p>Key indexes:<\/p>\n<p>           Item            Current     Previous  Change          <\/p>\n<p>           Thomson                               0.0          <\/p>\n<p>           Reuters\/HKEX                                    <\/p>\n<p>           CNH index                                       <\/p>\n<p>           Dollar index    113.996     113.192   0.7          <\/p>\n<p>*Divergence of the dollar\/yuan exchange rate. Negative number indicates that spot yuan is trading stronger than the midpoint. The People\u2019s Bank of China (PBOC) allows the exchange rate to rise or fall 2 percent from official midpoint rate it sets each morning.<\/p>\n<p>OFFSHORE CNH MARKET   <\/p>\n<p>           Instrument            Current   Difference          <\/p>\n<p>                                           from onshore          <\/p>\n<p>           Offshore spot yuan *  7.1704    -0.06%          <\/p>\n<p>           Offshore              7.035     -0.07%          <\/p>\n<p>           non-deliverable                           <\/p>\n<p>           forwards **                               <\/p>\n<p>*Premium for offshore spot over onshore<\/p>\n<p>**Figure reflects difference from PBOC\u2019s official midpoint, since non-deliverable forwards are settled against the midpoint.. <\/p>\n<p>(This story refiles to remove erroneous reference in paragraph 6 to official yuan fixing versus Reuters estimate)<\/p>\n<p> (Reporting by Winni Zhou and Brenda Goh)<\/p>\n<p><a href=\"https:\/\/www.oann.com\/uncategorized\/chinas-yuan-hits-28-month\/attachment\/file-photo-illustration-picture-of-chinese-yuan\/\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/09\/tagreuters.com2022binary_LYNXMPEI8P04H-BASEIMAGE.jpg\" alt=\"tagreuters.com2022binary_LYNXMPEI8P04H-BASEIMAGE\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>SHANGHAI (Reuters) \u2013 China\u2019s yuan touched a 28-month low against the dollar on Monday, only steps away from its downside trading limit, despite the central bank taking steps to rein<\/p>\n","protected":false},"author":66,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1657588","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1657588","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/66"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1657588"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1657588\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1657588"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1657588"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1657588"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}