China state-owned banks sold dollars as yuan fell to near seven-month low, sources say

SHANGHAI/BEIJING (Reuters) – China’s major state-owned banks were seen selling dollars for yuan in the onshore spot foreign exchange market on Tuesday to prevent the local currency from falling too rapidly, four people with knowledge of the matter said.

China’s state banks usually act on behalf of the central bank in the country’s foreign exchange market, but they could also trade on their own behalf.

The state banks’ actions came as the onshore yuan fell to a near seven-month low against a strengthening dollar in early deals on Tuesday.

The yuan last traded at 7.2529 per dollar as of 0310 GMT.

(Reporting by Shanghai and Beijing Newsroom; Editing by Muralikumar Anantharaman)