People’s Bank of China sets USD/CNY reference rate at 6.7829

The People’s Bank of China (PBOC) has set the USD/CNY central reference rate for the current trading session at 6.7829, compared to the previous day’s fix of 6.7852.

This recent midpoint setting represents a significant deviation from market expectations. On August 25, the PBOC set the daily yuan midpoint at 6.7852 per dollar, which was 633 pips below the Reuters consensus estimate. This marks the largest weak-side deviation since February 27.

Analysts note a pattern emerging since late July, where the PBOC has consistently fixed the midpoint below market expectations. This strategy appears intended to moderate the yuan’s recent strength, as the currency has gained approximately 4% year-to-date. By managing the daily reference rate, the PBOC influences the onshore spot yuan, which trades within a 2% band around the fixed point, to prevent rapid appreciation that could impact export competitiveness.