2023-07-25 13:06:31
An employee checks dollars and yuan at a bank in Anhui province, China. (Photo: AFP/VNA)
The British news agency Reuters quoted a source close to China’s major state-owned banks as selling dollars to buy yuan on the domestic and international spot market, in order to support the yuan.
Trading activities took place at the beginning of the session on July 25 on the Asian market. According to an unnamed source, China’s state-owned banks often act on behalf of People’s Bank of China (PBoC – Central Bank) trades on Forex market country, but it is also possible that these banks act out of the unique needs of the business.
The dollar selling activity comes after China’s top leaders pledged on July 24 to increase policy support for the economy, amid a slowing recovery from the COVID-19 pandemic.
Specifically, officials said the government would focus on boosting domestic demand and signaled the possibility of further growth stimulus measures.
Policymakers insist China will keep exchange rate yuan’s underlying stability at a reasonable and balanced level, while pledging to invigorate capital markets and restore investor confidence.
[Trung Quốc sử dụng một số biện pháp để “hãm” đà tăng của đồng NDT]
Analysts at HSBC note that Beijing has addressed the stability of the foreign exchange sector for the first time in recent years.
This means that easing the pressure to depreciate the yuan could become a policy priority in the near term.
This direction is consistent with the recent move by the PBoC to tighten foreign exchange policy.
This morning, RMB in the domestic market increased by 0.6%, to 7,1411 yuan to 1 USD. Since the beginning of 2023, the yuan has depreciated by 3.5% against the greenback.
Dieu Linh (VNA/Vietnam+)
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