FXStreet (Edinburgh) – In the opinion of analysts at BTMU, the PBoC could cut rates furher in the medium term.
“Over the past two months when China has operated, basically, a fixed exchange rate regime, there’s been a start-of-month dip looking like a parade of exporter selling followed by importer buying”.
“But maybe this time it’ll be the importers’ turn to be first. It’s that kind of market. Beyond the early dip we expect a return to flat-lining the rest of the week”.
“The Chinese USD debt pay down continues and may even accelerate given FOMC signals. In this exercise the government is providing all USD demanded to all comers at 6.2100”.
“This, of course, kills hedging: Why hedge if the government is going to do it for you? It’s that kind of market. CPI should edge up; putting off further pressure for another PBOC rate cut”.
In the opinion of analysts at BTMU, the PBoC could cut rates furher in the medium term…
(Market News Provided by FXstreet)