PBOC’s increased yuan bill sales in Hong Kong helped tighten offshore liquidity, stabilize yuan – former PBOC official 
FOREX POLICY & REGULATION
PBOC’s increased yuan bill sales in Hong Kong helped tighten offshore liquidity, stabilize yuan – former PBOC official 
FOREX POLICY & REGULATION

PBOC’s increased yuan bill sales in Hong Kong helped tighten offshore liquidity, stabilize yuan – former PBOC official 

 

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The PBOC’s increased sales of yuan-denominated bills in Hong Kong this week helped tighten liquidity in the offshore market to help stabilise the yuan by making it expensive for speculators to short the currency, reported China’s state-owned newspaper Shanghai Securities News citing Sheng Songcheng, a former official at the PBOC.

The PBOC sold 35 billion yuan ($4.81 billion) of yuan-denominated bills in Hong Kong on Tuesday, exceeding the 25 billion yuan of the bills due this month.

Higher offshore yuan bill sales in Hong Kong “could be related to recent yuan situations” as it would help stabilise foreign exchange market expectations, he said.

“The yuan exchange rate will not depreciate unilaterally, but will maintain two-way fluctuations,” he said, adding that if downside pressure on the offshore yuan persists, the PBOC could continue to issue more offshore yuan bills.