# China central bank relaxes yuan hedging rules as currency strengthens, capital outflows ease | Reuters

> The Chinese central bank relaxed its yuan hedging rules as the currency bounced to a near two-year peak against the dollar. The move follows easing capital outflows and gives authorities confidence to loosen their control of a currency that weakened sharply in 2016.

- Date: 2017-09-11 · published 2017-09-11T12:00:00.000Z
- Category: policy · region China · magnitude medium
- Page: https://feedsoft.ai/events/7799-china-central-bank-relaxes-yuan-hedging-rules-as-currency-strengthens-capital
- Commodities: [Chinese Yuan (CNY per USD)](https://feedsoft.ai/c/USDCNY.md)

## Why it matters

Easier hedging rules make it cheaper to buy dollars against the yuan, which can reduce pressure on the yuan and affect the cost of dollar-priced grain imports. The policy change is a currency measure with limited direct effect on feed commodity prices.

## Read by commodity

- USDCNY: neutral

## Linked price moves

| Commodity | Date | Window | Change % | z-score | Why linked |
| --- | --- | --- | --- | --- | --- |
| USDCNY | 2017-09-11 | 1 | +0.7% | 4.1 | The PBOC's relaxation of yuan hedging rules on 2017-09-11 is a same-day policy shift signaling comfort with a stronger yuan and easing outflow pressure, directly matching the 1-day move. |

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| USDCNY | 2017-07-03 | [China's new yuan factor comes into play when currency weakens \| Reuters](https://feedsoft.ai/events/70193-china-s-new-yuan-factor-comes-into-play-when-currency-weakens-reuters.md) | +0.3% | -0.8% |
| USDCNY | 2023-12-30 | [How China talked markets out of a run on the yuan By Reuters](https://feedsoft.ai/events/11839-how-china-talked-markets-out-of-a-run-on-the-yuan-by-reuters.md) | +0.8% | +1.1% |
| USDCNY | 2017-09-11 | [China scales back measures propping up its currency now that yuan has surged](https://feedsoft.ai/events/7804-china-scales-back-measures-propping-up-its-currency-now-that-yuan-has-surged.md) | +1.1% | +2.7% |
| USDCNY | 2019-10-20 | [China’s yuan exchange rate ‘appropriate’ after recent weakening, central bank chief says \| South China Morning Post](https://feedsoft.ai/events/56815-china-s-yuan-exchange-rate-appropriate-after-recent-weakening-central-bank.md) | -0.2% | -0.8% |
| USDCNY | 2019-02-25 | [China central bank vows to make yuan more flexible - Gulf Times](https://feedsoft.ai/events/60812-china-central-bank-vows-to-make-yuan-more-flexible-gulf-times.md) | -0.1% | +0.1% |

## Sources

- reuters.com: https://www.reuters.com/article/uk-china-forex-pboc/china-central-bank-relaxes-yuan-hedging-rules-as-currency-strengthens-capital-outflows-ease-idUSKCN1BM0IZ/

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