[MARKET UPDATE] USD/CNH climbs following the PBoC's lowering the FX risk reserve ratio back to 0% from the 20% level that had been in place since September 2022 and was a tool aimed at stabilising the FX market that made shorting the currency more costly

The PBoC's decision to lower the FX risk reserve ratio to 0% indicates a more accommodative stance toward currency trading, potentially encouraging a depreciation of the CNH against the USD. This move could further impact the USD/CNH currency pair, as it reduces the cost of shorting the CNH, aligning with broader market dynamics regarding the yuan's stability and China's economic outlook.