China Warns Traders on Yuan Speculation, Fueling Sharp Rebound

(Bloomberg) — China escalated its defense of the yuan by delivering a strong verbal warning to speculators and forceful guidance to investors with its daily reference rate, measures that pushed the managed currency away from a 16-year low.

The nation’s financial regulators will take action to correct one-sided moves in the market whenever needed, and they are confident of keeping the yuan basically stable, the People’s Bank of China (PBOC) said Monday in a statement. The central bank warning came a few hours after policymakers set a daily fixing that was stronger than expected by a record margin. State-owned lenders were actively selling dollars, according to traders who asked not to be named as they were not allowed to comment publicly.