The People’s Bank of China (PBOC) set the daily yuan reference rate at 7.2014 per dollar on Wednesday, slightly stronger than the previous fix of 7.2029. The move comes amid ongoing scrutiny of the central bank’s strategy to manage the currency amid a complex macroeconomic backdrop.
The firmer fix suggests Beijing may be seeking to stabilize the yuan following recent depreciation pressures driven by global dollar strength and concerns over China’s growth trajectory. Analysts see the PBOC’s gradual adjustment as a signal that authorities prefer to guide the yuan rather than allow sharp fluctuations.
Despite the stronger fix, the yuan continues to trade near the weaker end of its permitted range, as investor sentiment remains fragile due to sluggish demand and lingering property sector concerns. Still, the fix is viewed as a moderate attempt to bolster market confidence and prevent excessive one-sided moves.
Recent data from China, including softer-than-expected manufacturing PMI figures, have reinforced expectations that monetary authorities will maintain a cautious stance, balancing support for growth with efforts to avoid capital flight.
Currency markets will continue to monitor the PBOC’s daily fixes closely as a gauge of official tolerance for yuan volatility amid shifting global conditions.
