PBoC to issue central bank bills to support yuan
Move could reduce liquidity of offshore yuan and deter “hot money” flows, analysts say
China’s central bank will sell 30 billion yuan ($4.3 billion) of bills using the Hong Kong Monetary Authority’s bond-tendering platform on August 14.
The move will help improve the yuan yield curve in the offshore market, the People’s Bank of China (PBoC) announced on August 6. The PBoC plans to issue 20 billion yuan of three-month bills and 10 billion yuan of one-year bills.
The move could reduce offshore yuan liquidity and increase the cost of shorting the Chinese currency, analysts say.
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