UPDATE 2-China’s yuan pulls back after officials warn against speculation
Winni Zhou, Samuel Shen and Andrew Galbraith, 31 May 2021
SHANGHAI, May 31 (Reuters) – The yuan hit a three-year high against the dollar on Monday before falling back following a chorus of warnings from Chinese officials against speculative bets on the currency.
A former senior official at the foreign exchange regulator joined a slew of current and former officials on Monday cautioning against one way bets on the yuan, which has seen a two-month long rally against the dollar. In a commentary in the official China Securities Journal, Guan Tao warned against herd behaviour that could harm market order and weigh on China’s exporters.
Guan’s comments echoed those of a former central bank official, who said on the weekend that the yuan’s rise is not sustainable, and followed a warning by the central bank-backed Financial News of factors that could lead it to weaken against the dollar. Regulators said last week they would crack down on forex market manipulation, while leaving currency policy unchanged.
