CNY: A stronger hand from PBOC – ANZ

Analysts at ANZ suggest that after a sharp down-move in late May, USD/CNY appears to have found support at the 6.80 handle. 

Key Quotes

“Though not as significant as in May, the socalled “counter-cyclical adjustment factor” (CCAF) in the PBoC’s fixing mechanism continues to put a downward bias in the fix through June.  It will be interesting to see if the CCAF will be a key driver again as USD/CNY rebounds.”

“For now, 6.90 appears to be where the PBoC will cap the pair.”