Chinese Yuan: PBoC fix slows downside pace – OCBC

FXStreet Insights Team FXStreet

OCBC’s Christopher Wong reports USD/CNH briefly fell to its lowest level since February 2023 before rebounding after the PBoC set a higher-than-expected daily fix. Wong argues policymakers are leaning against the pace, not the direction, of RMB appreciation and expect subdued Dollar demand and RMB resilience to keep USD/CNH biased lower, with the fix acting as a speed limiter.

Fixing acts as speed limiter

"USD/CNH fell briefly to 6.7060 intra-day low on Monday, its lowest since February 2023. The pair then rebounded sharply after PBOC set the daily fix higher at 6.7795 (vs. Fri fix of 6.7787)."

"Market estimates was >700pips lower than the actual fix, reinforcing our view that policymakers are leaning against the pace, rather than the direction of RMB appreciation."

"Near term, subdued USD demand and underlying RMB resilience may continue to keep USD/CNH biased lower. We continue to favour a measured pace of RMB appreciation, with the fixing likely to serve as an important speed limit on further gains."

"USD/CNH last at 6.71 level. Daily momentum and RSI are not indicating a clear bias. 2-way risks likely in the interim. Support at 6.7060 (recent low), 6.70 levels. Resistance at 6.7180, 6.7270 (21 DMA)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD remains above 0.7200 after China's trade data

AUD/USD sits above 0.7200 in the Asian session on Tuesday, near its highest level since May 14. The US Dollar stays under pressure as a rallying Japanese Yen outweighs support from hawkish Fed bets and geopolitical tensions. This, along with firming expectations for another RBA rate hike later this month, acts as a tailwind for the Aussie. However, mixed China trade balance data keep the pair restricted.

USD/JPY stabilizes at around 154.00 as markets assess BoJ outlook

USD/JPY fluctuates at around 154.00 in the American session on Tuesday after rebounding from the six-month low it touched below 153.00 earlier in the day. Nevertheless, the upside attempts resemble technical corrections for now as Japan's upbeat wage growth data and Q2 GDP revision cement bets on a BoJ rate hike next week and continue to support the Japanese Yen.

Gold holds around $4,400, but for how long?

Gold (XAU/USD) remains on the back foot during American trading hours on Tuesday, even as the US Dollar (USD) remains on the defensive. Rising Oil prices and expectations of a Federal Reserve (Fed) rate hike weigh on the precious metal. At the time of writing, XAU/USD trades around $4,400 after reaching an intraday high near $4,443.

XRP ticks up as bullish derivatives, EMA support signal breakout

Ripple (XRP) is grinding upward and getting closer to a short-term breakout above $1.40 on Tuesday. This uptick follows the remittance token's defense of support at $1.38, after a short-lived attempt to breach selling pressure at $1.50 last week.

Europe in focus: September 2026

Six major net contributors demanded substantial cuts to the European Commission’s proposed 2028–2034 EU budget. Germany, Denmark, the Netherlands, Austria, Finland and Sweden issued a joint position on 27 August calling for the nearly €2 trillion proposal to be reduced by several hundred billion euros and rejecting additional common EU borrowing.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.