The People's Bank of China decided on Monday morning to set the exchange rate of the yuan against the US dollar at 7.1698 yuan per dollar, while expectations were for it to be set at 7.2295 yuan. The closing price of the pair in yesterday's session was 7.1705 yuan.
It is worth noting that the People's Bank of China influences the exchange rate of the US dollar USD by linking the value of its currency - the yuan - to the US dollar USD, using a fixed exchange rate policy to manage the value of the yuan by keeping it stable against a basket of currencies of countries that are considered partners of China. The basket is measured against the USD given that the United States is China's largest trading partner.
