China|PBoC’s exchange rate reform is to usher volatility but not sharp RMB depreciation
Published on Tuesday, August 11, 2015 | Updated on Sunday, May 13, 2018
China|PBoC’s exchange rate reform is to usher volatility but not sharp RMB depreciation
Summary
Today, the PBoC announced a reform of the RMB exchange rate formation mechanism, seeking to increase the flexibility of the exchange rate. In particular, the daily opening fixing rate of the RMB will be directly formed by market makers, namely 35 large banks designated by the authorities, in China’s onshore FX market instead of being set by the PBoC previously.
Topics
- Topic Tags
- Regional Analysis China
- Macroeconomic Analysis
Authors
Jinyue Dong
BBVA Research - Senior Economist
Le Xia
BBVA Research - Chief Economist