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How China Manages Its Currency — and What It Means for US Markets

Beginner Investing • 6 min

The US dollar's value against other major currencies is set by open market trading, minute to minute. China's yuan works differently: the People's Bank of China (PBOC) sets a daily reference rate and manages the currency within a controlled band around it, combined with capital controls that limit how freely money can move in and out of the country.This managed approach has repeatedly drawn accusations from US…

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