USD/CNY fix offers “more directional cues” - UOB
Analysts at UOB Group explained that the Federal Reserve Bank of New York (NY FED) published a research report concluding that after the recent changes in the USD/CNY’s daily fixing mechanism, the CNY “has become quite predictable and quite responsive to market forces”.
"The NY FED noted that the daily fix has now provided “more directional cues” and that official intervention in FX market appears “to have diminished”. The report concluded that “the Chinese currency’s behavior has come to more closely resemble the short horizon random walk behavior typically found in freely floating currencies”. However, the report also stressed that the views are “solely to stimulate discussion” and “do not necessarily reflect the official position of the Federal Reserve”.