Iris Pang, Economist at ING, notes that in October, the Chinese central bank spent $91.58 billion on forex purchases, which is the second largest amount in 2018, but was less than the biggest forex purchase in September, which was $119.39 billion.
Key Quotes
“This data has always been eye-catching, especially during the yuan’s depreciation, because it implies the central bank has spent money in the market to stop or slow down the depreciation by buying dollars. And we don’t completely rule out this possibility.”
“Given the speed of the monthly yuan depreciation in October, which was 1.56%, up from 0.55% in September, we believe the central bank might have bought dollars to intervene as the speed of the depreciation indicates more intervention.”
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