PBoC Wants to Know When Fed Will Cause Yuan Depreciation

Bloomberg: China Said to Plan Asking U.S. on Timing of Fed Rate Hike
The Chinese delegation will try to deduce whether a June or a July rate rise is more likely, as the nation’s policy makers prepare for the potential impact on financial markets and the yuan, the people said, asking not to be named as the discussions were private. In China’s view, if the Fed does lift borrowing costs, a July move would be preferable, the people said. A People’s Bank of China press officer later denied that China plans to ask about the timing of a Fed rate hike.

China’s exchange rate has already been weakening as expectations rise for the U.S. central bank to boost its benchmark rate for the first time since it ended its near-zero policy in December with a quarter percentage point increase.
The PBoC and large banks are anticipating a rate hike now, stepping in to buy dollars in a period of relative calm. The move caused jitters in the market though: Sudden Dollar Shortage in China as Big Banks Buy

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