Yesterday a China foreign ministry spokesman said "The exchange rate of China's RMB is determined by the market. There are ups and downs. It's a two-way float"
Wrong.
Each day the People's Bank of China set a 'reference rate' and allows the market to trade the rate plus or minus two percent from that rate.
So, no, not a free float at all.
The end.
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There is a 'pirate' currency that can trade at whatever rate you like, the offshore yuan, CNH.
So there is that.
Stay tuned for today's RMB onshore mid rate setting, it hits just after 0115GMT and ForexLive reports it each day.
Oh, while we're on the foreign ministry comments, the spokesman also said China is not engaged in a currency war,
- China is not trying to boost exports through competitive devaluation
- China's economic fundamentals are sound
I'll leave it up to you to decide if that is more b/s or not.
