"PBOC believes the yuan should be gradually trending up vs the US dollar this year"

Credit Agricole on the People's Bank of China and the Chinese yuan:

• The PBOC believes the yuan should be gradually trending up versus the U.S. dollar this year
• is trying to manage the market in this direction
• "Since the latest move of USD/CNY higher was significant and went against the appreciation direction, they are trying to smooth it via the fixing."

This comes as today the Bank set the mid-rate for the onshore yuan significantly stronger (lower USD/CNY) than market surveys had shown was expected:

• PBOC sets USD/ CNY reference rate for today at 6.4624