Yuan Falls, Ending Two-Day Rally, on Concerns About China’s Slowdown

The Chinese yuan fell today, snapping its two-day rally, on the speculation that the slowdown of China’s economy may cause the nation’s policy makers to slow appreciation of the currency.
The average earnings of 505 companies tracked by the Shanghai Composite Index were 3.6 percent below the analysts’ forecast. The data followed the earlier speculation that China’s manufacturing is slowing, adding to evidences of economic slowdown in China. The signs of slowing economy cause market participants speculate that China wouldn’t be as keen to allow the yuan appreciate, as it was previously suggesting. The People’s Bank of China set its reference rate 0.03 percent lower at 6.2932 today, reducing the fixing for the second day.
USD/CNY advanced from 6.3066 to 6.3073 as of 11:51 GMT today.

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