The People's Bank of China set the reference rate for the onshore yuan above 7 today but not as high as was expected.

When I say not as high as expected that's for USD/CNY and it means the yuan was not set as weak as expected. All this week we've had a focus on the reference rate setting as the PBOC allows the yuan to slide after propping it up in past moths.

As the yuan was allowed to slide it negatively impacted on risk perceptions, thus weakening bond yields, equities and other risk trades (eg AUD) .

Today's not as weak as expected has led to a rally in 'risk' on a 'well that could have been much worse' basis.

more:

  1. Eyes again on the PBOC reference rate for onshore yuan today
  2. PBOC sets USD/ CNY reference rate for today at 7.0039 (vs. yesterday at 6.9996)
  3. PBOC onshore yuan mid rate setting was not as weak as expected for CNY
  4. CAD making a break for it, higher oil, not quite so low yuan give it a boost

Offshore yuan was expecting a much weaker CNY rate, its reversed since the setting:

The People's Bank of China set the reference rate for the onshore yuan above 7 today but not as high as was expected.