On the Monday trading session, the value of the Chinese yuan ended up hitting a two-year low. This happened as the central bank of China made an announcement in regards to a reduction in the lending rates.
Chinese Yuan Sinks to almost Two-Year Low
The data surrounding the Chinese yuan shows that on Monday, its value dropped tremendously. Compared to the trading price of the greenback, the value of the Chinese yuan experienced a two-year low on Monday.
Bitcoin Revolution is a crypto trading tool for investing in the crypto market with an %88 average win rate on trades and is the #1 trading software for crypto traders from all around the globe in 2022. Try it For FREE Today.
So far, the trading value of the Chinese yuan has come close to the two-year low and it is due to the decision made by the People’s Bank.
People’s Bank Cuts Lending Rates
The latest reports confirm that the People’s Bank of China has just announced another cut in the lending rates. This is the second time in two weeks that the People’s Bank of China has announced a reduction in the lending rates.
The recent decision made by the People’s Bank of China has given rise to many uncertainties and these uncertainties may keep rising.
Then comes the monetary policy of the Federal Reserve which is also encouraging uncertainties and jitters among the investment community.
Performance of Yuan versus the Dollar
Compared to the United States dollar (USD), the value of the Chinese yuan has sunk at a high rate. The value of the yuan has fallen so much that it has come close to hitting a two-year low.
The Monday trading session witnessing such a fall in the trading price of the yuan has sent the entire Chinese market into a state of shock.
According to data from the latest trading session, the trading value of the yuan has fallen by 0.1% versus the dollar. At the time of writing, the value of the yuan is 6.8273 versus the greenback.
This is the weakest level the value of the Chinese yuan has hit since September of 2020.
The announcement by the PBoC
An announcement was made recently by the People’s Bank of China that announced that it had lowered the benchmark for the lending rates.
This is the second time in two weeks that the PBoC has made an announcement in regards to the lending rates.
PBoC is worried about Many Economic-Pulls
The reason behind the reduction is the worry of the PBoC due to several factors that are impacting the Chinese economy.
The Chinese economy is facing multiple challenges and headwinds that come from the energy crisis, a struggling real estate market, and the COVID lockdowns.
Performance of other Asian Currencies
Ever since the recent trading session in the Chinese market, the trading value of the Asian currencies has experienced slumps.
The report shows that the value of the Malaysian ringgit has dipped by 0.3%, South Korea won, and the Singapore dollar has dipped by 0.2%. The market value of the Japanese yen has dipped by 0.4% as well.
Best Forex World is not responsible for the content, accuracy, quality, advertising, products or any other content posted on the site. Some of the content on this site (not all) is paid content that is not written by our authors and the views expressed do not reflect the views of this website. Any disputes you may have with brands or companies mentioned in our content will need to be taken care of directly with the specific brands and companies. The responsibility of our readers who may click links in our content and ultimately sign up for that product or service is their own. Cryptocurrencies, NFTs and Crypto Tokens are all a high-risk asset, investing in them can lead to losses. Readers should do their own research before taking any action.