# One way or another: China's yuan policy tweak a warning shot in old battle

> The central bank reduced the effect of a counter-cyclical factor, introduced in May to limit volatility, in the yuan's daily calculation. The yuan initially fell when the change was reported on Tuesday. The move makes the currency more responsive to market forces.

- Date: 2018-01-11 · published 2018-01-11T12:00:00.000Z
- Category: macro · region China · magnitude medium
- Page: https://feedsoft.ai/events/67196-one-way-or-another-china-s-yuan-policy-tweak-a-warning-shot-in-old-battle
- Commodities: [Chinese Yuan (CNY per USD)](https://feedsoft.ai/c/USDCNY.md)

## Why it matters

A weaker yuan makes Chinese exports more competitive and raises the yuan cost of dollar-priced imports such as feed grains and soymeal, which could slightly reduce Chinese import demand. The effect on feed prices is modest but worth tracking.

## Read by commodity

- USDCNY: bullish ▲

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| USDCNY | 2017-01-03 | [Yuan starts 2017 weaker after PBOC cuts fixing by most in two weeks \| South China Morning Post](https://feedsoft.ai/events/10250-yuan-starts-2017-weaker-after-pboc-cuts-fixing-by-most-in-two-weeks-south-china.md) | -0.1% | -1.0% |
| USDCNY | 2024-07-09 | [China’s central bank is stuck in a policy dilemma](https://feedsoft.ai/events/12299-china-s-central-bank-is-stuck-in-a-policy-dilemma.md) | -0.1% | -1.9% |
| USDCNY | 2020-02-20 | [Breaking: The People's Bank of China cut interest rates: AUD and Yuan sliding — Octa](https://feedsoft.ai/events/54798-breaking-the-people-s-bank-of-china-cut-interest-rates-aud-and-yuan-sliding-octa.md) | +0.3% | +0.7% |
| USDCNY | 2023-01-03 | [China’s COVID-19 Situation and Possible BoJ’s Policy Tweak to Shape FX Trend in January: Kenanga](https://feedsoft.ai/events/12762-china-s-covid-19-situation-and-possible-boj-s-policy-tweak-to-shape-fx-trend-in.md) | -1.8% | -2.1% |
| USDCNY | 2019-06-03 | [China: Revising yuan lower but 7.0 should hold \| articles \| ING THINK](https://feedsoft.ai/events/58821-china-revising-yuan-lower-but-7-0-should-hold-articles-ing-think.md) | +0.0% | -0.5% |

## Sources

- reuters.com: https://www.reuters.com/article/us-china-yuan-factor/one-way-or-another-chinas-yuan-policy-tweak-a-warning-shot-in-old-battle-idUSKBN1F015E/

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