PBoC raises reserve requirement on FX forwards trading to 20%

According to the latest headline floating on the wires, via Bloomberg, the People's Bank of China (PBoC) adjusts forward foreign exchange risk reserve requirement ratio to 20%.

Key points:

   •  Current forward foreign exchange risk reserve requirement ratio is 0%.
   •  New forward foreign exchange risk reserve requirement ratio effective from August 6.
   •  It will take counter-cyclical measures to keep FX markets stable based on market conditions.

The US Dollar fell across the board in reaction to the news as traders continue to reposition themselves ahead of the keenly watched US monthly jobs report (NFP).