Yen and Yuan Watch: USD/JPY and USD/CNY Daily — 2026-10-07

Top developments

Japan reports zero FX intervention in September

The Ministry of Finance announced on September 30 that no foreign exchange intervention was conducted between August 27 and September 28. This period followed the record coordinated US-Japan intervention in July. The absence of recent intervention suggests Japanese authorities are relying on verbal guidance and yield differentials rather than direct market operations to manage USD/JPY levels near 157.

PBoC sets yuan fix above market expectations

On September 30, the People’s Bank of China (PBoC) set the USD/CNY central parity at 6.7351, which was weaker than the Reuters estimate of 6.7025 but stronger than the previous day’s reference rate of 6.7411. This "tightening" move indicates the PBoC is actively managing the yuan's trajectory, potentially to curb excessive volatility or signal stability ahead of high-level diplomatic talks.

Carry trade flows shift away from JPY

With the yen appreciating roughly 6% against the dollar since late July due to previous interventions and policy shifts, investors are reassessing carry trade funding sources. Recent analyses suggest a migration toward currencies like the Canadian Dollar and the Chinese Yuan for funding purposes, reducing immediate pressure on the BoJ to intervene further in the short term.

Local view

Nikkei: Yen resilience amidst dollar strength

Nikkei reports that the yen has continued to resist dollar strength, with market participants interpreting the Bank of Japan’s recent "Main Opinions" publication as not undermining the rationale for yen appreciation. The local media focus remains on whether the current exchange rate levels are sustainable without further direct intervention from the Ministry of Finance.

Sina Finance: RMB independent trend

Chinese media highlights the yuan's "independent trend," noting that while global markets fluctuate, the RMB has shown resilience supported by export strength and central bank guidance. Reports emphasize that the PBoC's counter-cyclical tools are effectively keeping the yuan stable within a narrow band around 6.70-6.73 against the dollar.

Context & numbers

• USD/JPY: Closed flat at 157.41 after reversing intraday losses, reflecting a lack of active intervention during the reported period.
• USD/CNY Fixing: Set at 6.7351 on Sept 30, compared to the previous 6.7411 and a market estimate of 6.7025.
• China Forex Reserves: As of end-September 2026, China's forex reserves stood at $3.4003 trillion, a month-on-month decrease of 1.11%.

On the radar

• Upcoming Diplomatic Talks: Market participants are closely watching for any policy signals or verbal guidance from Chinese authorities ahead of the anticipated Trump-Xi summit, which has historically influenced yuan fixing strategies.
• BoJ Policy Minutes: Traders are awaiting further details from the Bank of Japan regarding their stance on interest rate normalization, which remains a key driver of the USD/JPY yield spread.