AIRLINK 75.07 Increased By ▲ 1.37 (1.86%)
BOP 4.89 Decreased By ▼ -0.01 (-0.2%)
CNERGY 4.39 Decreased By ▼ -0.13 (-2.88%)
DFML 42.75 Decreased By ▼ -2.13 (-4.75%)
DGKC 84.20 Decreased By ▼ -1.30 (-1.52%)
FCCL 21.25 Decreased By ▼ -0.15 (-0.7%)
FFBL 32.21 Decreased By ▼ -0.30 (-0.92%)
FFL 9.42 Decreased By ▼ -0.17 (-1.77%)
GGL 10.06 Decreased By ▼ -0.21 (-2.04%)
HASCOL 6.99 Decreased By ▼ -0.14 (-1.96%)
HBL 114.15 Decreased By ▼ -0.55 (-0.48%)
HUBC 139.16 Increased By ▲ 0.06 (0.04%)
HUMNL 12.05 Decreased By ▼ -0.37 (-2.98%)
KEL 4.93 Decreased By ▼ -0.10 (-1.99%)
KOSM 4.38 Decreased By ▼ -0.07 (-1.57%)
MLCF 37.15 Decreased By ▼ -0.45 (-1.2%)
OGDC 133.97 Decreased By ▼ -2.83 (-2.07%)
PAEL 25.10 Decreased By ▼ -0.29 (-1.14%)
PIBTL 6.59 Decreased By ▼ -0.10 (-1.49%)
PPL 118.74 Decreased By ▼ -2.26 (-1.87%)
PRL 26.04 Decreased By ▼ -0.55 (-2.07%)
PTC 13.80 Decreased By ▼ -0.30 (-2.13%)
SEARL 56.65 Decreased By ▼ -0.65 (-1.13%)
SNGP 66.81 Decreased By ▼ -1.19 (-1.75%)
SSGC 10.31 Decreased By ▼ -0.11 (-1.06%)
TELE 8.28 Decreased By ▼ -0.17 (-2.01%)
TPLP 10.87 Decreased By ▼ -0.11 (-1%)
TRG 62.55 Decreased By ▼ -0.79 (-1.25%)
UNITY 27.02 Decreased By ▼ -0.03 (-0.11%)
WTL 1.34 Decreased By ▼ -0.04 (-2.9%)
BR100 7,893 Decreased By -47.3 (-0.6%)
BR30 25,330 Decreased By -317.7 (-1.24%)
KSE100 75,182 Decreased By -335.2 (-0.44%)
KSE30 24,148 Decreased By -129.4 (-0.53%)

SHANGHAI: China’s yuan held steady against the US dollar as the central bank skipped interest rate cuts in its market operations on Monday, while offshore yuan funding costs surged to their highest in nearly four months.

The People’s Bank of China (PBOC) kept benchmark lending rates unchanged at its monthly fixing on Monday, matching market expectations, with authorities seen as having limited scope for monetary easing amid downward pressure on the yuan.

The decision came after the central bank surprised markets last week by maintaining its medium-term lending facility rate.

Meanwhile, offshore yuan liquidity has shown signs of tightness.

Hong Kong’s offshore yuan one-week CNH HIBOR - a measure of offshore yuan liquidity conditions - jumped to 4.95045%, the highest since Sept. 26.

Surges in yuan funding costs have also made it more expensive for investors to short the yuan.

Yuan weaken for third week

Prior to market open on Monday, the central bank set its midpoint rate, around which it allows the yuan to trade in a 2% band, at 7.1105 per dollar, 62 pips firmer than the previous fix of 7.1167, and the strongest level in a week.

The spot yuan opened at 7.1940 per dollar and was changing hands at 7.1955 at midday, 23 pips weaker than the previous late session close.

The global dollar index fell to 103.171 from the previous close of 103.288.

Offshore yuan was trading 99 pips weaker than onshore spot at 7.2054 per dollar.

Overall, the offshore yuan is likely to remain under growing pressure and contribute to broader dollar strength, said analysts at Barclays.

“We maintain our USDCNY 7.35 end-Q1 forecast, even as the PBOC maintains a rigid stance on fixings to prevent a sharp currency decline,” Barclays analysts said.

Comments

200 characters