China’s yuan was almost unchanged against the dollar on Friday, despite the central bank's weaker midpoint setting, which traders credited to reassurances President Xi Jinping gave on the health of the country's economy.
The People’s Bank of China (PBOC) set the midpoint rate at 6.3595 per dollar prior to market open, 0.15 per cent weaker than the previous fix 6.3497.
The spot market opened at 6.3600 per dollar and was changing hands at 6.3566 at midday, barely moved from the previous close. If the spot yuan closes at the midday level, it will inch 0.07 per cent weaker for the week.
During his state visit to Britain, Xi said “there will be no hard landing’’ of the world's second-largest economy, though he acknowledged some downward pressure for it as well.
Xi’’ comments and the outcome of his visit to Britain “helped reassure investors and stabilise the yuan,’’ said a trader at a foreign bank in Shanghai.
A senior official at the foreign exchange authorities said regulators would step up monitoring of cross-border capital.
Wang Xiaoyi, deputy head of the State Administration of Foreign Exchange (SAFE), had said on Thursday that recent outflows of money from China were “normal’’, downplaying fears over growing outflows as the economy slows.
The offshore yuan was trading 0.46 per cent weaker than the onshore spot at 6.3862 per dollar.