The yuan is trading at the highest sine mid-November
Some kind of squeeze is hitting the yuan. The thinking is that the government is trying to clear out shorts.
It all comes after a last week's announcement that China would tighten the soft peg to the dollar. Today's move also came after holidays on Monday and Tuesday.
In China, there is always far more going on below the surface and official explanations rarely tell the whole story.
For the skeptics, the government is trying to counteract capital flight and jitters about the stock market and the economy. But no one really knows what's going on.
With China, when something unexplained hits, the temptation in markets is often to head to the sidelines and wait for the dust to settle. It's not at that point yet, but with iron ore prices also cratering, there are plenty of reasons to keep a close eye on China.
