PBoC said on Monday that it would cut the reserve requirement ratio (RRR) again, by 0.5%. It is the second time this year, and PBoC hoped to release funds in long-term liquidity to boost economic growth. A total of 1.2 trillion Yuan (US$188 billion) worth of long-term liquidity is expected to be released into the interbank system on December 15th. The move comes amid signs that China’s economic growth is slowing down, especially in the real estate sector, which China has been heavily dependent on for growth. USDCNY is currently trading at 6.3684, down 0.11%. As expected, China’s trade surplus will continue to offer support on its currency for a while despite easing.
AUDUSD rose sharply by 0.6% today, currently trading at 0.7089. RBA left its rates at a record low and commented that Omicron would not derail the country’s economy. Investors are expecting that, despite being highly contagious, this new variant will be mild.