PBOC Fixes Yuan Dramatically Stronger Following Gold Spike

PBOC fixed the yuan dramatically stronger against the dollar overnight, sending offshore yuan surging to its strongest against the dollar in six months.

While the Chinese currency is reportedly strengthening on the heels of trade talks optimism (which is entirely the opposite of the rhetoric coming out of Washington), we note that this was the biggest positive shift in the yuan fix in 19 months…

Notably, the yuan is strengthening considerably more against the dollar than it is against the broad basket of trade partner currencies…Shanghai Accord 2.0?

And coincidentally, the surge in yuan comes the day after gold prices broke out higher…

Perhaps the PBOC’s aggressive action was prompted to manage the Yuan peg against gold back into balance?

Original source: http://feedproxy.google.com/~r/zerohedge/feed/~3/oRpq_Jtbo1Y/pboc-fixes-yuan-dramatically-stronger-following-gold-spike