PBOC: credit where due, they are fixing CNY higher – BTMU

By FXStreet FXStreet (Guatemala) – Analysts at Bank of Tokyo Mitsubishi explained, in respect to CNY, while they do expect reserve loss again in January, they think it could be smaller than that of December, because there were fewer forwards maturing for PBOC.

Key Quotes:

“Even should we see a big loss there is only CNH to react and we think we’d already seen offshore intervention last Friday (after the big USD/JPY move) and this Tuesday. Press sentiments are antsy: Lots of warnings of elephants rustling about in bushes and big FXO positions.

But credit where due, PBOC is indeed fixing USD/CNY lower as we had urged, seemingly reducing risks this will be a head fake. CFETS promised more flexibility in USD/CNY vs. its basket.”
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Source:: FX Street