China’s central bank sets yuan midpoint at 6.7165 per dollar, weaker than estimate
Key Facts
The People’s Bank of China set the yuan midpoint at 6.7165 per dollar on 28 October, compared with 6.7171 the previous day, according to data carried by TMGM. The fixing was well above Reuters’ estimate of 6.6734, meaning the announced rate was weaker for the yuan than expected. The 6.6734 figure was a prior estimate, not the rate announced by the bank. The daily fixing serves as a reference for yuan trading in China, where the currency is allowed to move within a 2% band on either side of the midpoint. The gap between the estimate and the actual decision puts the 28 October fixing at the center of attention on the currency’s path.
The fixing followed the bank’s setting of the midpoint at 6.7162 per dollar on 26 October, its strongest level since 2 February 2023, according to Reuters. Even so, that fixing was 471 basis points weaker than Reuters’ estimate of 6.6691. The comparison shows that the midpoint reading cannot be separated from the gap between the rate announced by the bank and market estimates. On 28 October, the actual rate was 6.7165, close to the previous day’s 6.7171. Year to date through 26 October, the yuan had risen 4.87% in the onshore market and 4.63% in the offshore market against the dollar, according to Reuters.
The production index rose to 51.7%, up 1.3 percentage points from the previous month, while the new orders index registered 50.5% after falling 0.1 percentage point. The components show an improvement in production alongside a slight decline in new orders. Value added at industrial enterprises above the designated size also rose 5.5% year on year in September, at a pace 0.3 percentage point faster than the previous month. The National Bureau of Statistics described production and supplies as posting rapid growth and said foreign trade showed good momentum in the first three quarters.
Activity indicators remain part of the economic backdrop as China’s leadership targets growth of between 4.5% and 5% in 2026, following growth of 5% in 2025, according to The Associated Press. Data at the end of September showed outstanding yuan-denominated loans of 283.44 trillion yuan, while broad M2 liquidity reached 359.63 trillion yuan. Total social financing to the real economy stood at 468.17 trillion yuan at the end of the same month, according to data carried by China’s State Council. In September, the interest rate on the one-year supplementary lending facility was cut from 1.75% to 1.5%. The quota for relending for scientific innovation and technological upgrading was also increased by 200 billion yuan, as part of structural monetary measures aimed at supporting specific areas of the economy.
EL7 data showed the offshore dollar-yuan pair closed at 6.66487 on 27 October. That close differs from the official midpoint of 6.7171 that day, as the former reflects the offshore market rate and the latter the daily fixing. Under this framework, the daily trading rule allowed the yuan to move within a 2% band around the midpoint. The September purchasing managers’ index report was published on the National Bureau of Statistics’ website at 9:30 on 1 October 2026. The currency backdrop includes its gains since the start of the year, alongside the difference between the actual fixing and Reuters’ estimate on 28 October.