Economics
Yuan Volatility Drops to Nine-Month Low on PBOC Stability Bets
- Sentiment improving as central bank defends key level: OCBC
- Signs of calm compare with devaluation turmoil a year ago
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A gauge of swings in the yuan fell to the lowest level since November amid receding bearish bets and speculation China’s central bank is helping keep the exchange rate stable.
The currency’s three-month implied volatility, which is used to price options, dropped 13 basis points to 4.6 percent as of 4:30 p.m. in Hong Kong, according to data compiled by Bloomberg. The extra cost for three-month options to sell the yuan against the dollar in the Hong Kong market over contracts to buy was near the lowest level since September 2014.