Banking
New yuan rate ‘fixes distortions’
Chinese 100 yuan banknotes are seen in this picture illustration taken in Beijing in this July 11, 2013 file photo. [Photo/Agencies]Reference point for RMB exchange vs US dollar cut 1.86% by central bank China’s central bank devaluated the yuan against the US dollar by 1.86 percent on Tuesday, the largest single-day drop since exchange rate reforms began in January 1994. The People’s Bank of China cut the reference rate against the US dollar to 6.2298 yuan per dollar, down from 6.1162 yuan a day earlier, the lowest level in more than two years. In a move seen as a step toward liberalizing the yuan, the People’s Bank of China said that it will base the yuan-US dollar exchange rate more on the previous day’s closing rate at the interbank foreign exchange market. The move would correct price distortions from the bank’s previous interventions, experts said. However, the bank stressed that Tuesday’s depreciation was a “one-off” move to fix the discrepancy between the reference rate and the market’s spot rate.
Chinese 100 yuan banknotes are seen in this picture illustration taken in Beijing in this July 11, 2013 file photo. [Photo/Agencies]Reference point for RMB exchange vs US dollar cut 1.86% by central bank China’s central bank devaluated the yuan against the US dollar by 1.86 percent on Tuesday, the largest single-day drop since exchange rate reforms began in January 1994. The People’s Bank of China cut the reference rate against the US dollar to 6.2298 yuan per dollar, down from 6.1162 yuan a day earlier, the lowest level in more than two years. In a move seen as a step toward liberalizing the yuan, the People’s Bank of China said that it will base the yuan-US dollar exchange rate more on the previous day’s closing rate at the interbank foreign exchange market. The move would correct price distortions from the bank’s previous interventions, experts said. However, the bank stressed that Tuesday’s depreciation was a “one-off” move to fix the discrepancy between the reference rate and the market’s spot rate.
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New yuan rate ‘fixes distortions’
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