Weekend Long Read: Six Tools China Uses to Manage Its Currency

The yuan’s exchange rate has a significant impact on international trade, and it is also a channel for financial risk to spread into China from overseas. Therefore, it is crucial to keep it stable, and the People’s Bank of China (PBOC) has developed a slew of tools to do just that.

This article will give an overview of these tools, analyze their effectiveness, and posit some monetary policy suggestions.