PBOC Slams Yuan Shorts Again - Strengthens Currency Most Since 2005

It appears the messaging from The People's Bank Of China to The Fed was heard loud and understood. Having exercised its will to weaken the Yuan (implying turmoil is possible), Janet Yellen delivered the dovish goods and so China 'allowed' the Yuan to rally back. In a double-whammy for everyone involved the biggest 3-day strengthening of the Yuan fix since 2005 also pushed Yuan forwards back to their richest relative to spot since Aug 2014 - once again showing their might against the dastardly speculative shorts.

As we warned previously, it appeared a 'message' was being sent to The Fed via Yuan weakness  - first ahead of The FOMC meeting and then, as several hawks got vocal, ahead of Janet's speech. Her uber-dovishness was rewarded as China 'allowed' the Yuan to rise and thus the USDollar to weaken...

 

And since Janet delivered, PBOC has strengthened the Yuan Fix by the most since 2005!!

 

Crushing shorts as Yuan forwards collapse back to their 'richest' relative to spot since Aug 2014...

 

And just like Keyser Soze, they were gone. So while the old mantra of "Don't fight The Fed" may apply to some, it most certainly does not apply to The PBOC...