China's Central Bank Sets USD/CNY Midpoint at 6.7817, Previous 6.7808

The China Foreign Exchange Trade System announced that Friday's USD/CNY central parity rate was set at 6.7817, a slight increase of 9 basis points from the previous day. This setting continues the recent trend of the midpoint fluctuating within a narrow range, indicating regulators' intention to maintain basic exchange rate stability.

**Midpoint Setting Stronger Than Market Expectations**

According to Reuters calculations, the market's estimate for today's midpoint was approximately 6.7262. The actual published figure of 6.7817 was significantly higher than this estimate, indicating that the central bank has sent a clear stability signal through its pricing mechanism. The midpoint formation mechanism requires market makers to reference the previous day's closing price and comprehensively consider foreign exchange supply and demand. This notably stronger setting reflects the central bank's intention to curb depreciation pressure on the yuan amid external market volatility. As of press time, the offshore yuan was trading around 6.72369 against the dollar, showing a certain gap from the midpoint level.

**Counter-Cyclical Factor Continues to Play a Role**

Market sources indicate that the recent yuan midpoint has consistently been stronger than market expectations, driven by the central bank's counter-cyclical adjustment factor. This tool allows quoting banks to adjust the midpoint pricing model based on macro-prudential needs, to hedge against pro-cyclical fluctuations in the foreign exchange market. Under the current complex international financial environment, this move helps manage market expectations and prevent one-sided "herd effect" movements in the exchange rate.

**Exchange Rate Policy Tone Remains Focused on "Stability"**

Despite external uncertainties, maintaining exchange rate stability has always been part of the People's Bank of China's monetary policy objectives. Through daily midpoint settings, the central bank conveys clear policy intentions to the market. Analysts believe this "self-oriented" pricing strategy aims to secure more independent space for domestic monetary policy while avoiding disorderly adjustments in the yuan exchange rate. This policy orientation is unlikely to change easily in the short term.