The yuan has started to further appreciate. If you look at some simple moving averages, you will find the yuan below the 20 day as well as longer-term averages. It is currently at 6.575. The yuan has taken on a stair-step process with a decline followed by a rest and then a further decline. Monetary policy has tightened with continued increases in reserve rates and it look like the PBOC is willing to allow further appreciation to help control inflation. The PBOC sets a fixing rate everyday with a tolerance of .5 around the mid-point.
Of course, the PBOC has stated that any changes are not the result of external pressure for appreciation.
PBOC governor Zhou Xiaochuan reiterated that Beijing would decide the pace of yuan appreciation on its own and would not take into account pressure from other countries. "External pressure has never been an important factor of consideration and we have never paid special attention to it," Zhou said in Paris at a G20 gathering of monetary policy heads.
Some have noted that yuan appreciation usually occurs around political events like the G20 meetings, major elections or summits.
Of course, the PBOC has stated that any changes are not the result of external pressure for appreciation.
PBOC governor Zhou Xiaochuan reiterated that Beijing would decide the pace of yuan appreciation on its own and would not take into account pressure from other countries. "External pressure has never been an important factor of consideration and we have never paid special attention to it," Zhou said in Paris at a G20 gathering of monetary policy heads.
Some have noted that yuan appreciation usually occurs around political events like the G20 meetings, major elections or summits.
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