Beijing does not stop. After the new injection of liquidity into the banking system, the Central Bank of China announced that it has cut the benchmark interest rate yuan against the dollar at a 4-year low (August 2011), or 6,4085 yuan against the greenback. The reduction is 0,07% compared to yesterday.
The reference rate is the rate around which the yuan is allowed to float. An analyst at the China Merchant Bank indicated that "the yuan continues to fall against the dollar, partly under pressure from investors, as the markets' expectations of a devaluation of the currency are being realized."
However, the Chinese central bank was careful not to use the term "devaluation", stating that it had simply changed the way it calculates the reference rate of the yuan to reflect the value assigned to it by the markets in a "more truthful" way.
Previously, the institute had injected in the banking system the equivalent of more than 23 billion dollars.
