Central bank tries to soothe global markets as China lets yuan fall further
China’s central bank said Thursday that there was no basis for further depreciation in the yuan given strong economic fundamentals, in a bid to reassure jittery global markets after it devalued the currency earlier in the week.
As the yuan fell for the third straight day, the People’s Bank of China (PBOC) said the country’s strong economic environment, sustained trade surplus, sound fiscal position and deep foreign exchange reserves provided “strong support” to the exchange rate CNY=CFXS.
China’s decision to devalue the currency Tuesday by pushing its official guidance rate down 2 percent sparked fears of a “currency war” and roiled global financial markets, dragging other Asian currencies to multi-year lows. Read more