# Chinese state banks seen using FX swaps to absorb dollars, sources say

> Major state-owned Chinese banks are reportedly conducting large currency swaps to absorb an influx of dollars, possibly to cap yuan appreciation. One-year dollar/yuan swap points rose to 1,750 from about 1,610 the prior week.

- Date: 2021-03-16 · published 2021-03-16T12:00:00.000Z
- Category: macro · region China · magnitude low
- Page: https://feedsoft.ai/events/48334-chinese-state-banks-seen-using-fx-swaps-to-absorb-dollars-sources-say
- Commodities: [Chinese Yuan (CNY per USD)](https://feedsoft.ai/c/USDCNY.md)

## Why it matters

Intervention to limit yuan strength affects China's currency-driven import costs, and the effect on feed commodity prices is indirect.

## Read by commodity

- USDCNY: neutral

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| USDCNY | 2018-10-30 | [Major Chinese banks seen swapping yuan for dollars in forwards: traders \| Reuters](https://feedsoft.ai/events/62767-major-chinese-banks-seen-swapping-yuan-for-dollars-in-forwards-traders-reuters.md) | -0.5% | -0.1% |
| USDCNY | 2020-12-31 | [China state banks buy dollars to ease sharp yuan rally, traders say](https://feedsoft.ai/events/49863-china-state-banks-buy-dollars-to-ease-sharp-yuan-rally-traders-say.md) | -0.7% | -0.8% |
| USDCNY | 2024-03-26 | [Chinese Yuan Bounces Back Against US Dollar](https://feedsoft.ai/events/31443-chinese-yuan-bounces-back-against-us-dollar.md) | +0.3% | +0.4% |
| USDCNY | 2017-10-10 | [Chinese firms rush to hedge as yuan swings begin to sting \| South China Morning Post](https://feedsoft.ai/events/6416-chinese-firms-rush-to-hedge-as-yuan-swings-begin-to-sting-south-china-morning.md) | -1.0% | -0.3% |
| USDCNY | 2024-09-27 | [Australia, NZ dollars energised as China optimism boosts risk, resources - Markets - Business Recorder](https://feedsoft.ai/events/28576-australia-nz-dollars-energised-as-china-optimism-boosts-risk-resources-markets.md) | +0.1% | +1.6% |

## Sources

- reuters.com: https://www.reuters.com/article/us-china-markets-intervention-exclusive-idUSKBN2B81U9/

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.