“This rise is very encouraging for it breaks with historical precedents,” said analysts at research house GaveKal Dragonomics. “Indeed, in moments of tensions in international financial markets, Beijing’s initial default reaction has always been to freeze like a deer in headlights and prevent any currency appreciation at all costs. But not this time.”
More recently, the Central Bank infused $10.95 billion into the markets, which “signaled the central bank’s stance that stabilizing financial markets is one of its key policy targets, especially when overseas markets are tumbling,” remarked a bond trader in Shanghai.
iShares FTSE/Xinhua China 25 Index Fund (NYSEArca: FXI)
WisdomTree Dreyfus Chinese Yuan Fund (NYSEArca: CYB)
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Max Chen contributed to this article.