PBOC plans to add a “counter-cyclical adjustment factor" in Yuan fixing formula
|Bloomberg cites people familiar with the matter, providing insights on the earlier headline - China PBOC said to plan change in Yuan fixing formula.
Key Details:
Under the new formula, institutions that provide quotes for the fixing will take into account:
The previous day's official closing price at 4:30 p.m. local time,
The changes in baskets of currencies,
And the new counter-cyclical adjustment factor
The new formula would partly filter out the impact of excessive volatility in the spot market by reducing the closing price's role in the next day's fixing
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