This regulation will better reflect the de facto demand and supply in the foreign exchange market.

But there is still some difference compared with the practice in the international market where fluctuation of trading currencies are mostly not bottomed or capped.

More large-scale projects and infrastructure construction following the 11th Five-Year Plan contributed to the rising loans. Besides, Chinese banks, which are eager to meet their business targets for this year, are also giving out more loans.

Therefore, the previous mechanism can hardly mirror the true situation.