Says if USD/CNY rises to 6.7, it would worry the PBOC
The Bank may respond by:
- suspending the operation of devaluing yuan
- take actions to dampen volatility
And:
- possible for the PBOC to use forex reserves or reintroduce the counter-cyclical factor into its fixing formation mechanism to support the yuan
Via Bloomberg, comments from Zhang Ming, senior fellow at the Chinese Academy of Social Sciences. Bloomberg citing an MNI report.
More:
- PBOC doesn't want to see a one-way market expectation
- Concerned it'd cause further depreciation of yuan and even fuel capital outflow
- PBOC may step in if yuan continues a sharp, rapid depreciation against the USD
