China’s yuan climbed to its highest levels since the fourth quarter of last year, despite a weak economic reading, as authorities reportedly tinker with currency policies.

The offshore yuan, or CNH, rose, with the dollar fetching as little as 6.7229 yuan on Thursday, the weakest for the greenback since October — down from levels over 6.82 yuan last week.

Onshore, the dollar was trading as low as 6.7830 yuan, which was the U.S. currency’s weakest since November, compared with levels above 6.86 yuan last week.

The People’s Bank of China’s daily fixing was at 6.8090 on Thursday, the yuan’s strongest since November, from 6.8633 on Wednesday, according to Reuters.

Due to holidays, China’s markets were closed on Monday and Tuesday, while Hong Kong’s was shuttered on Tuesday.

Even the Caixin/Markit Manufacturing Purchasing Managers’ index falling to 49.6 in May — both below the 50.1 forecast from a Reuters poll and below the 50 level which indicates contraction — failed to dent the yuan rally.

The Chinese currency’s gains came as the CNH overnight interbank offered rate in Hong Kong spiked as high as 42.815 percent on Thursday, from 21.079 percent on Wednesday — up from 5.353 percent on May 29, according to Reuters data.

The spikes in rates and the yuan came after China policymakers said last week they planned to change the methodology for setting the currency’s daily fixing from one that was more market-based, relying heavily on the previous day’s close and changes to a currency basket, to one that added a “counter-cyclical adjustment” factor.

Further explanation wasn’t provided, leaving those factors a mystery for speculators.

Analysts said policymakers were likely signalling they didn’t want the yuan to weaken further.

“The consensus viewed the introduction of the counter-cyclical adjustment factor as signalling the PBOC’s desire for a stronger yuan,” Tim Condon, managing director at ING Financial, said in a Thursday note.

“We thought the fixing formula tweak would ‘work’ eventually in persuading people that, like the rest of dollar/Asia ex-Japan, when the dollar depreciates against major currencies (DXY goes down), it should depreciate against the yuan,” Condon said. “But we thought it would take more than one session.”

Others also noted that the change likely signalled the recent downtrend in the yuan could be at an end.

“It is a further sign of reluctance at senior levels to allow prices to be set by market forces,” Chang Liu and Mark Williams, economists at Capital Economics, said in a note on Wednesday. “The key implication of the change to the fixing regime though would seem to be that officials are determined not to allow sizeable depreciation.”

The economists said they expect the yuan to continue to appreciate against the dollar, expecially if the greenback weakens more broadly. They raised their year-end forecast for dollar/yuan to 6.90 from 7.10 and to 6.70 from 6.80 for the end of 2018.

Other analysts also pointed to local banks stepping into the market to sop up yuan liquidity by selling dollars.

“This immediately caught out investors who were initially wrong-footed by the deceptively high dollar/yuan fixing yesterday morning (relative to market’s projections) and had chosen to go long the dollar/offshore yuan on this,” analysts at Macquarie said in a note on Thursday. “This ugly, yet familiar, cat-and-mouse game between authorities and investors highlights the perils of trading the onshore and offshore yuan; this is a key factor why we have repeatedly noted our distaste for trading yuan.”

The yuan’s level had become a campaign issue in the U.S., with then-candidate Donald Trump vowing to label the country a currency manipulator for the purposes of a competitive trade advantage and threatening to impose a tariff of as much as 45 percent on China’s exports to the U.S.

But analysts have long noted that the yuan was declining primarily due to dollar strength and that policymakers had actually appeared to be intervening in the market to prevent the renminbi from falling even further.

President Trump later reversed himself, reneging on promises to label China a currency manipulator.

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