Woman holds Chinese Yuan banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration/File photo
SINGAPORE – In recent months, China has sought to stabilize the yuan by orchestrating buying by state banks and giving market guidance to bankers.
The strategy of moral suasion marks a sharp break from Beijing’s approach the last time the currency was on the ropes, in 2015.
Back then, the People’s Bank of China (PBOC) resorted to official intervention as the central bank burned $1 trillion in reserves to shore it up.
This year, as China’s economy wobbled and money left the country, the PBOC took a starkly different approach, defending the currency by signaling to markets what kind of selling it would and would not tolerate.
Interviews with 28 market participants show at least two dozen cases where regulators closely and frequently steered market participants through a range of coordinated actions this…
