PBOC Cautions Against ‘Herd Effect’ as Yuan Extends Rally

The People’s Bank of China has warned against “herd effect” and self-reinforcing, irrational expectations in the foreign-exchange market, introducing the terminology into its quarterly monetary policy statement for the first time as the currency extends its recent gains.

The rhetoric, included in a statement released Thursday summarizing the Monetary Policy Committee’s third-quarter meeting held Sept. 19, signals heightened regulatory scrutiny of one-way market bets. The onshore yuan traded near 6.7 per U.S. dollar on Thursday, up roughly 1% from the end of the second quarter and more than 3.9% since late 2025.