On Monday morning, the People's Bank of China decided to set the exchange rate of the yuan against the US dollar at 7.1885 yuan per dollar. Expectations had suggested it would be set at 7.3442 yuan. The closing price of the pair yesterday was 7.3327 yuan. The bank also injected 24.8 billion yuan through repurchase operations in the markets for a period of 7 days, with a yield of 1.5%.
It is worth noting that the People’s Bank of China influences the value of the US dollar (USD) by pegging the value of its currency - the yuan - to the US dollar. The bank employs a fixed exchange rate policy by managing the value of the yuan, keeping it stable against a basket of currencies from countries that are considered partners to China. This basket is measured against the value of the USD, as the United States is China's largest trading partner.
