SHANGHAI China has intervened repeatedly in foreign exchange markets to stabilize the yuan after it unexpectedly devalued the currency last month, fueling fears of a global currency war.
Beijing appears to have been so surprised by the global reaction to the devaluation that it is now trying to contain the impact, with officials describing the move as a technical adjustment and repeatedly saying they see no basis for further weakness in the yuan.
Following is the timeline of PBOC currency interventions, official market-stabilizing steps and statements.
** Sept 18 - The People's Bank of China (PBOC) has ordered banks to tighten supervision of clients' foreign exchange deals and strictly check the authenticity of clients' forex purchases and sales to prevent cross-border arbitrage, sources told Reuters.
The yuan has appreciated 0.2 percent against the dollar so far in September, with traders reporting that the PBOC has stepped up interventions to support the currency. (For market reports, please click [CNY/])
** Sept 17 - The State Administration of Foreign Exchange says it will conduct checks on firms' foreign exchange buying to prevent speculation on yuan depreciation and step up a crackdown on illegal cross-border money transactions.
** Sept 16 - China's top economic planner, the National Development and Reform Commission, tells Chinese firms to issue more bonds and borrow more loans in offshore markets, a move seen as retaining foreign exchange onshore.
** Sept 14 - Data shows the PBOC and commercial banks sold a net 723.8 billion yuan ($113.69 billion) of foreign exchange in August, reflecting the size of the PBOC's interventions.
** Sept 11 - The PBOC has asked banks to strengthen supervision of foreign exchange purchases by foreign-held non-resident accounts (NRA) to tighten loopholes in its managed capital account, sources told Reuters.
** Sept 10 - Offshore yuan in Hong Kong [CNY=D3] shoots up on suspected, rare intervention by Chinese state banks on behalf of the central bank, a bold gesture by authorities to shake out speculators betting on further yuan losses.
** Sept 7 - China's foreign exchange reserves drop the most in a month on record in August, reflecting Beijing's attempts to halt the slide in the yuan and stabilize financial markets.
** Sept 2 - China's foreign exchange regulator issues new rules relaxing restrictions on multinational firms' management of their foreign currency-denominated debt in China, allowing them to pool debt from their subsidiaries for central management.
** Sept 1 - The PBOC plans to tighten rules on trading of currency derivatives from October, requiring banks to keep the equivalent of 20 percent of derivative positions in dollar reserves to be held for a year at no interest, in a move to curb speculation and volatility.
** Aug 31 - The yuan depreciates 2.7 percent in August in the aftermath of the unexpected devaluation on Aug. 11. The yuan also depreciates against a trade-weighted basket.
The BIS (Bank for International Settlements) index for the yuan's REER - its value against the trade-weighted basket after adjustments based on inflation - dropped to 131.30 in August, down 0.6 percent from a record high of 132.11 in July.
** Aug 27 - In a rare move, the PBOC intervenes in yuan derivatives markets to push down the implied discount of the yuan's value in the future against its current value to reduce market expectations of further depreciation.
** Aug 25 - Premier Li Keqiang was quoted by state television as saying that there is no basis for continued depreciation of the yuan.
** Aug 13 - The PBOC steps up intervention, ordering state banks to buy yuan at designated rates on behalf of monetary authorities, among other emergency measures.
** Aug 12 - The yuan falls to a four-year low amid speculation that Beijing wants it to weaken even further to help struggling exporters.
In a bid to soothe global jitters, the PBOC says there is no basis for a sustained depreciation in the yuan given global and domestic economic conditions.
** Aug 11 - China surprises the world by devaluing the yuan by nearly 2 percent. In trading, the currency slumped 1.8 percent in its biggest daily fall since China established the currency market in 1994.
(This factbox has been refiled to correct the headline to 'devaluation' from 'revaluation')
(Reporting by Lu Jianxin and Pete Sweeney; Editing by Kim Coghill)
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