PBoC Forced To Intervene As Yuan Losses Turn Disorderly

The PBoC stepped in to stanch profuse bleeding in the yuan Monday, after the currency careened lower alongside Chinese equities. Beijing cut the FX reserve ratio, partially undoing a December move aimed at slowing what, at the time, was unwanted appreciation. The one percentage point reduction (to 8%), is effective from May 15. The offshore yuan trimmed declines following the move. At one point Monday, USDCNH breached 6.60, the weakest levels for the yuan since 2020 (figure below). Chinese