Stocks in Asia were mixed on Thursday following the release of Caixin PMI data from China, which was at an 11-month low and as the yuan hit a seven-month high.
The on-shore yuan traded at 6.7894 to the dollar at 12:29 p.m. HK/SIN, at levels not seen since last November. Before markets opened in China, the People’s Bank of China set the yuan mid-point at 6.8090 to the dollar — its strongest level in seven months according to Reuters.
China’s central bank lets the yuan spot rate rise or fall a maximum of 2 percent against the greenback, relative to the official fixing rate.
In the offshore market, where the yuan is more freely traded, the currency fetched 6.7309 to the dollar.
“While there remains some politics in play after the Moody’s downgrade, with numerous projects recently tabled through the ‘One Belt, One Road’ initiative, the stronger yuan could be in China’s best interest to promote yuan internationalization and attract more investment,” OANDA Senior Trader Stephen Innes said in a note