China Scales Back Measures Propping Up Its Currency

China’s central bank on Monday scrapped two measures that were put in place to support the yuan when it was under significant selling pressure, suggesting Beijing is anxious to quash one way bets on the yuan as outflows ease and exporters face strain.

The move comes as the yuan bounced sharply this year to hit a near two-year peak on the dollar last week, giving authorities the confidence to relax their grip on a currency that had stumbled badly in 2016 and raised risks to economic stability.

With China’s economy humming along at a solid pace and putting to bed concerns of a sharper slowdown, the central bank is likely to pursue a more neutral yuan rate with the potential for increased two-way volatility, analysts said in the wake of the rules changes.

“The central bank seems to convey the idea that China conducts a dynamic policy making process,” Commerzbank

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