FXStreet (Guatemala) – Analysts at Bank of Tokyo Mitsubishi UFJ explained that it may be helpful to make some general guesses about Chinese official preferences about their own currency.
Key Quotes:
“In 2012 Chinese officials tried to convince markets 6.3000 was a good level for USD/CNY to settle, as a long-run equilibrium. In 2013 they said 6.1000. In 2014 they stopped talking and directly pushed the market to accept higher USD/CNY and two-way variability.”
“Since USD/CNY was at 6.2100 before the policy change, it might not be too far from the truth to guess that 6.2000 is official China’s preference for a USD/CNY long-run equilibrium. (Of course, just because Chinese officials think this is where the yuan should settle doesn’t mean it will.)”
(Market News Provided by FXstreet)