Things are looking much better for the Chinese Yuan as the central parity rate of the Chinese currency renminbi, or the Yuan had managed to strengthen up to 68 pips to 7.1570 against the dollar on Thursday, which came according to the China Foreign Exchange Trade System.
In China’s spot foreign exchange market, the Yuan was also allowed to rise or fall by two per cent from the central parity rate each trading day.
The central parity rate of the Yuan against the dollar is quite based on a weighted average of prices which had been offered by some of the market makers before the opening of the interbank market each business day.
In another related report, it has been revealed that is not the best of times for the British pound as it has reportedly sunken on Thursday by more than one percent against the United States dollar after the sudden move by the Bank of England to fully intervene on some of the the bond markets to head off a fresh financial catastrophe.
The Pound Sterling had also slid as low as $1.0763 in the early morning of Thursday as London deals one day after the BoE had snapped up its long-dated government bonds, or gilts, to prevent a material risk to stability.
The British central bank had also vowed Wednesday to buy as many of the gilts as it was needed to calm the markets which had been reportedly plagued by concerns that last week’s UK budget will send debt soaring.
The BoE’s move “has certainly upped the level of concern over the potential negative economic and financial market fallout from the loss of confidence in UK’s public finances”, said MUFG analyst Lee Hardman.