The USD to CNY trading pair went down yesterday as the People’s Bank of China takes measures to support the Chinese economy. The yuan received support after the PBOC said that it will start reducing its RRR (reserve requirement ratio) this month.
The USD to CNY trading pair contracted by 0.20%, or 0.0143, points in sessions. The pair recorded levels from ¥7.0990 to ¥7.1220 with an asking price of ¥7.1054 to ¥7.1087 in yesterday’s trading.
Aside from the USD to CNY pair’s lost, other major currencies such as the EUR and JPY both lost against the yuan.
The EUR to CNY exchange rate went down by 0.24%, or 0.0185 points, in yesterday’s trading. The EUR CNY pair recorded ranges between ¥7.8390 and ¥7.8712 in sessions.
The Japanese yen didn’t stand a chance at the renewed strength of the Chinese yuan on Tuesday. The CNY JPY exchange rate rose 0.16% or 0.0247 in sessions, hitting ranges from ¥15.0500 to ¥15.1298 yesterday.
Despite the yuan’s impressive performance, the Swiss franc still managed to hold on to its gains in yesterday’s trading. The CHF to CNY trading pair inched its way up by 0.10%, or 0.0072 points, recording level from ¥7.1580 to ¥7.1835 in sessions.
The British pound sterling also held up its ground, managing to recover a mere 0.03%, or 0.0027 points, in sessions. The GBP CNY trading pair went from as low as ¥8.7420 and up to ¥8.8056 on Tuesday’s trading.
The People’s Bank of China recently announced that it will be reducing its RRR by 50 bps. Yuan traders shifted their focus towards the PBOC’s decision, supporting the yuan along the way.
The rate slash is meant to support the faltering Chinese economy, allowing banks to pump out more funds to lend smaller businesses.
The People’s Bank of China freed around 80 billion yuan or 11.29 billion US dollars into the financial system. Based on the reports, Beijing will hold on to its prudent monetary policy while keeping market liquidity at an ample level.