PBOC Doubles Yuan Trading Band To 2%

China doubled the limit for the yuan’s daily moves against the U.S. dollar, easing controls on the exchange rate as appreciation bets waned amid slower economic growth.

The yuan will, from today, be able to trade as much as 2 percent on either side of a daily central bank reference rate, from 1 percent previously, the People’s Bank of China said in a statement on its website on March 15. The band was last widened in April 2012 from 0.5 percent, and before that from 0.3 percent in May 2007.

The move underscores pledges from China’s leaders to make the exchange rate more market based and promote freer movement of capital in and out of the country for investment purposes. The central bank said it will continue to increase the yuan’s two-way flexibility after last month highlighting an “orderly” broadening of the currency’s trading band among its 2014 policy goals.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu