China’s central bank has taken one more step to strengthen the yuan, making it more expensive for traders and institutions to bet on the currency after it weakened rapidly against the yuan. with the dollar.
The People’s Bank of China said on Monday that financial institutions selling foreign exchange forward contracts would be subject to a 20 percent risk reserve ratio, up from zero today. The change, which will go into effect on September 28, will make it more expensive for banks – and their customers, respectively – to sell yuan to buy dollars in the derivatives market.
