19 Jan 2016
China: CFETS CNY NEER hits lows back to Dec 14 - Westpac
FXStreet (Delhi) – Martina Song, Research Analyst at Westpac, notes that the rapid rise in USD/CNY at the beginning of January triggered a selloff in equities and spread to other markets.
Key Quotes
“Since then, the USD/CNY fix has been stable around 6.5615/50. The PBoC’s Ma, the chief economist at the research bureau, said earlier this week that the exchange rate mechanism should “maintain stability against a basket of currencies” while “appropriately limiting” the daily volatility of USD/CNY.
Both Westpac’s CNY TWI and our estimate of the CFETS basket show CNY slipping early 2016 though recovering over the past few days. Since Dec 31, the yuan has depreciated by around 1.4% against the US dollar and 0.5% against the basket. The CFETS basket has eased off lows since Dec 2014 as other currencies weaken.”
Key Quotes
“Since then, the USD/CNY fix has been stable around 6.5615/50. The PBoC’s Ma, the chief economist at the research bureau, said earlier this week that the exchange rate mechanism should “maintain stability against a basket of currencies” while “appropriately limiting” the daily volatility of USD/CNY.
Both Westpac’s CNY TWI and our estimate of the CFETS basket show CNY slipping early 2016 though recovering over the past few days. Since Dec 31, the yuan has depreciated by around 1.4% against the US dollar and 0.5% against the basket. The CFETS basket has eased off lows since Dec 2014 as other currencies weaken.”