Hi all, Mike here.
Hey, does anyone watch or trade the USD/CNY?
I read an article recently on it. There’s something going on this year with that. And it seems to be going to have an effect of the comm dolls, of course. The price is going up, up and more up. Is it the Chinese are slacking off on their appreciation ride? They are the second largest economy in the world and I think it is definitely worth noting.
Does anyone know anything about what’s going on? And the effects that it spills over onto everyone else?
Also…why is that pair seem to be NOT a major player on the market? Is is because they aren’t part of the G10 or something like that?
I would love someone to explain the Chinese role in the global market.
Thanks for listening.
Mike
Hi, Mike. Just came across your post. It is true that the Yuan has recently pulled back from its long-term appreciation, and the Chinese announced that they would widen the band that it trades it. They are having some issues with their economy right now - corporate bond defaults, implementation of reforms, and a shakeout of their shadow banking system. I had to cash out my USDCNY shorts and now I’m long, profitable for now.
The only broker that I know of that trades CNY is OANDA; and they price it based on some futures derivative magic that I don’t understand. So their USDCNY is priced around 6.15, whereas the official exchange rate is something like 6.22 (as of today, 22 March 2014). Their prices still seem to rise and fall with the market as expected, though.