China leads the yuan to a carefully studied rate

China aimed its currency, the Yuan, to a carefully coordinated rate, as the central bank tries to alleviate some of the effects of the trade war on the economy without destabilizing the financial markets. The Chinese People’s Bank weakened the yuan’s daily reference price for the fifth consecutive day Wednesday, but it reduced the pace of the amendment. According to traders, government banks have been noted that they sell the dollar in large quantities to support the yuan in the internal market. The external yuan increased in the largest rate in a month, partly compensation on Tuesday 1.1%, which spurred him to the lowest level since the market of the market in 2010. As for the currency in the internal market, it dropped slightly. “The authorities want to manage the frequency of the yuan and do not want an unimportant surprise movement. But the general trend takes more in the dollar against the yuan, if the US fees are not withdrawn. I do not see a sudden and significant reduction in the value of the currency,” said Joho Goo, the Head of Asia, in the Australian and New -Hall Group. The move from the Chinese People’s Bank came at a time when no solution to the commercial crisis was on the horizon, with President Donald Trump with a comprehensive 104% fee on many Chinese goods. Earlier this week, China promised to “fight to the end” and respond to customs threats. The Yuan bounces after a poor installation of the Chinese People’s Bank, the Yuan is under pressure from the bets that the Chinese central bank will eventually allow some weakness to face the impact of US fees on the economy in light of the terrible growth expectations, and expected more financial facilitation. However, China has not yet made a sharp and sudden reduction of the value of the currency as some expected. On Tuesday, negative bets on the yuan received a boost after the central bank allowed the so -called ‘installation’ to exceed the 7.20 level against the dollar, a level that investors consider a soft red line that reflects the intentions of the authorities to the currency driven, as Trump was elected. The Yuan has dropped in the internal market, which is allowed to trade a series of 2% on the price of the installation, and it is therefore subject to strict control of the central bank, to the lowest level since September 2023 as a response. However, the weakness of the acute Yuan has a high cost despite its potential support for export; This could weaken the confidence of Chinese assets and increase the anger of the United States, as Trump has already accused China of manipulating his currency to compensate for customs duties. Signs of China’s attempt to control the pace of the yuan, and there are indications that China is trying to control the rate of the yuan decline. According to traders who asked not to reveal their identity, government banks sold large amounts of dollars at a level of about 7,3460 in the morning trading in the internal market to support the currency. The Chinese bank weakened 0.04%on Wednesday, or half of the rate of the previous session, to reach 7.2066. The gap between the price of installation and market estimates has expanded to 1.321 basis points, which is the highest level since February. The Oversea Chinese Banking Corp, in a note: “Policymakers may prefer to maintain a carefully stable yuan. The installation rate between the dollar and the yuan should be poorly increased from tension against the yuan, and also provides an outlet for Asia currencies”.