Latest news with #PBOC
Business Recorder
15 hours ago
- Business
- Business Recorder
China's yuan rises on stronger fixing, weaker dollar outlook
HONG KONG: China's yuan firmed against the US dollar on Friday as the central bank set the daily fixing stronger and as expectations of dollar weakness supported the currency. Prior to the market opening, the People's Bank of China set the midpoint rate at 7.1695 per dollar - its strongest since March 17 and 106 pips firmer than a Reuters' estimate. The PBOC has guided the yuan's daily fixings firmer in recent sessions — a move viewed as an effort to boost confidence in the currency amid an uneven Chinese economy and uncertainty over Sino-US trade talks. Meanwhile, China kept benchmark lending rates unchanged as expected on Friday, after Beijing rolled out sweeping monetary easing measures a month earlier to support the economy. By 0400 GMT, the yuan was 0.08% higher at 7.1811 to the dollar after trading in a range of 7.1756 to 7.1822. Its offshore counterpart traded at 7.1819 yuan per dollar, up about 0.06% in Asian trade. The sluggish dollar performance in June amid concerns over the ballooning US fiscal deficit and the durability of US assets due to the trade war, also helped the yuan. 'Emerging market currencies are marginally stronger versus the dollar month-to-date and have held onto their May gains', Goldman Sachs analysts said in a note. China's yuan hits one-week low on worries over Middle East conflict The bank expects some low yielding Asian currencies, including Chinese yuan, to continue to perform well versus the dollar. The yuan is up 0.3% against the dollar this month, and 1.7% this year. The PBOC governor vowed to promote further yuan internationalisation at the 2025 Lujiazui Forum earlier this week, also lifting sentiment. Separately, the Hong Kong dollar hit 7.85 per US dollar on Friday, touching the weak end of its trading band against the dollar for the first time since May 2023, according to LSEG data.
The Star
a day ago
- Business
- The Star
China likely to keep lending rates steady after May cut, trade truce
SHANGHAI: China is widely expected to keep its benchmark lending rates unchanged at a monthly fixing on Friday, a Reuters survey showed, after Beijing rolled out sweeping monetary easing measures a month earlier to aid the economy. A framework agreement covering tariff rates between Washington and Beijing has raised optimism the world's two largest economies can get business activity back on track, reducing the urgency for additional easing measures. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 20 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady. Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages. Last month, China lowered LPRs for the first time since October, while major state banks lowered deposit rates as authorities cut borrowing costs to help buffer the economy from the impact of the Sino-U.S. trade war. Market participants said key rates now move in tandem with the seven-day reverse repo rate, which serves as the main policy rate. "That means any adjustment to the LPR should follow changes to the seven-day reverse repo rate," said a trader at a brokerage, noting it will also take some time to gauge the impact of stimulus measures introduced in May. However, a string of disappointing economic data, including slower-than-expected credit growth and deepening deflationary pressure, has underscored the need for more stimulus. "Near-term economic stabilisation is dependent on reaching a trade deal with the U.S., which will take precedence over more policy stimulus," said Ho Woei Chen, economist at UOB. Chen expects the seven-day reverse repo rate to be reduced by 10 basis points in the fourth quarter of this year and guide LPRs to lower by the same margin. "The prospect of another 50-basis-point cut to the reserve requirement ratio (RRR) remains in place," she said. - Reuters
Business Standard
2 days ago
- Business
- Business Standard
PBOC chief calls for multi-polar currency system; promotes digital yuan
Central Bank of China head, Pan Gongsheng, speaking at China's main financial forum in Shanghai, said that a multipolar international monetary system can prompt sovereign currency issuers to strengthen policy constraints, enhance the resilience of international monetary system, and more effectively safeguard global economic and financial stability. He spoke on how the necessity to weaken the excessive reliance on a single sovereign currency and its negative impacts, foster healthy competition among a few strong sovereign currencies, and put in place incentive-restraint mechanisms. Pan also pointed to European Central Bank President Christine Lagarde's recent comments on the uncertainty of U.S. dollar dominance. Lagarde, President of the European Central Bank (ECB), noted in her recent speech that the global order based on multilateral cooperation is fracturing, with uncertainty about the dominant role of the U.S. dollar, and the changing landscape could open the door for the euro to play a greater international role. PBOC Governor Pan warned that the international currency, if dominated by the sovereign currency of a single country, has inherent instabilities. Over the past decade, the driving forces behind the shifts in the international monetary system stemmed primarily from the economic and financial dimensions in the wake of the global financial crisis, and hence the discussions were centered on economic and financial developments, he stated. He also talked about the steady rise of the RMBs international status after the global financial crisis in 2008. The RMB has already become the worlds second largest trade finance currency. Calculated on a comprehensive basis, the RMB has become the worlds third largest payment currency. Besides, the weight of the RMB in the International Monetary Funds Special Drawing Rights (SDRs) currency basket ranks third. Going forward, the international monetary system is likely to continue its evolution towards a system where a few sovereign currencies coexist and compete with checks and balances. Be it a single sovereign currency or a small group of sovereign currencies serving as the global dominant currency, the sovereign currency issuers should assume their responsibilities by strengthening domestic fiscal discipline and financial regulation, and advancing the structural reform of the economy, Pan noted. He also spoke about the problems faced by the traditional cross-border payment system and growing calls for improving it. After over a decade of construction and development, China has basically established a cross-border RMB payment and clearing network featuring multiple channels and wide coverage, the PBOC governor said.
Yahoo
2 days ago
- Business
- Yahoo
China likely to keep lending rates steady after May cut, trade truce
SHANGHAI (Reuters) -China is widely expected to keep its benchmark lending rates unchanged at a monthly fixing on Friday, a Reuters survey showed, after Beijing rolled out sweeping monetary easing measures a month earlier to aid the economy. A framework agreement covering tariff rates between Washington and Beijing has raised optimism the world's two largest economies can get business activity back on track, reducing the urgency for additional easing measures. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 20 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady. Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages. Last month, China lowered LPRs for the first time since October, while major state banks lowered deposit rates as authorities cut borrowing costs to help buffer the economy from the impact of the Sino-U.S. trade war. Market participants said key rates now move in tandem with the seven-day reverse repo rate, which serves as the main policy rate. "That means any adjustment to the LPR should follow changes to the seven-day reverse repo rate," said a trader at a brokerage, noting it will also take some time to gauge the impact of stimulus measures introduced in May. However, a string of disappointing economic data, including slower-than-expected credit growth and deepening deflationary pressure, has underscored the need for more stimulus. "Near-term economic stabilisation is dependent on reaching a trade deal with the U.S., which will take precedence over more policy stimulus," said Ho Woei Chen, economist at UOB. Chen expects the seven-day reverse repo rate to be reduced by 10 basis points in the fourth quarter of this year and guide LPRs to lower by the same margin. "The prospect of another 50-basis-point cut to the reserve requirement ratio (RRR) remains in place," she said. Error in retrieving data Sign in to access your portfolio Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
China likely to keep lending rates steady after May cut, trade truce
SHANGHAI (Reuters) -China is widely expected to keep its benchmark lending rates unchanged at a monthly fixing on Friday, a Reuters survey showed, after Beijing rolled out sweeping monetary easing measures a month earlier to aid the economy. A framework agreement covering tariff rates between Washington and Beijing has raised optimism the world's two largest economies can get business activity back on track, reducing the urgency for additional easing measures. The loan prime rate (LPR), normally charged to banks' best clients, is calculated each month after 20 designated commercial banks submit proposed rates to the People's Bank of China (PBOC). In a Reuters survey of 20 market watchers conducted this week, all respondents expected both the one-year and five-year LPRs to remain steady. Most new and outstanding loans in China are based on the one-year LPR, while the five-year rate influences the pricing of mortgages. Last month, China lowered LPRs for the first time since October, while major state banks lowered deposit rates as authorities cut borrowing costs to help buffer the economy from the impact of the Sino-U.S. trade war. Market participants said key rates now move in tandem with the seven-day reverse repo rate, which serves as the main policy rate. "That means any adjustment to the LPR should follow changes to the seven-day reverse repo rate," said a trader at a brokerage, noting it will also take some time to gauge the impact of stimulus measures introduced in May. However, a string of disappointing economic data, including slower-than-expected credit growth and deepening deflationary pressure, has underscored the need for more stimulus. "Near-term economic stabilisation is dependent on reaching a trade deal with the U.S., which will take precedence over more policy stimulus," said Ho Woei Chen, economist at UOB. Chen expects the seven-day reverse repo rate to be reduced by 10 basis points in the fourth quarter of this year and guide LPRs to lower by the same margin. "The prospect of another 50-basis-point cut to the reserve requirement ratio (RRR) remains in place," she said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
