The People's Bank of China (PBOC), China's central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a "band," around a central reference rate, or "midpoint." It's currently at +/- 2% and some think it could widen to 3% at some stage in the future.
How the process works:
Note that the PBOC's management of the yuan's exchange rate has been a source of controversy, with some arguing that the central bank undervalues the currency to gain a trade advantage. However, in recent years, China has been moving towards a more market-oriented exchange rate system and has allowed greater flexibility in the yuan's value.
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Earlier:
People's Bank of China Governor says room for lower rateChina’s efforts to prop up its flagging stock market has made yuan a casualty This article was written by Eamonn Sheridan at www.forexlive.com. Read More Details
Finally We wish PressBee provided you with enough information of ( PBOC sets USD/ CNY reference rate for today at 7.1889 )
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