RMB exchange rate index to shift the market’s attention away - ANZ

FXStreet (Delhi) - Khoon Goh, Senior FX Strategist at ANZ, suggests that the CFETS launched a new RMB exchange rate index but the research house does not believe this heralds a shift in the way the PBoC manages the currency.

Key Quotes

“Rather, it is an attempt to shift the market’s attention away from focusing solely on RMB moves against the USD.”

“Hence, maintaining the RMB exchange rate “basically stable at an adaptive and equilibrium level” can be consistent with further depreciation of the yuan against the USD, particularly if the dollar remains strong once the US Federal Reserve starts to normalise policy.”