Early Reaction to China's Currency Announcement

No news yet on the dollar-yuan parity, but overseas markets are reacting to the PBOC Saturday announcement..

The euro, Australian dollar and New Zealand dollar rose in early Asia trade Monday. Since the Chinese will now be fixing their currency against a basket of foreign currencies, the strength here is to be expected, as it is likely China will be taking positions in these currencies to keep the yuan from appreciating too quickly.

According to WSJ, the 10-year U.S. Treasury yield was last at 3.276% in Tokyo, little changed from 3.227% at Friday's close in New York.

Japan's Nikkei Stock Average was up 1.5%, Australia's S&P/ASX 200 was 1.5% higher, South Korea's Kospi Composite rose 1.5% and New Zealand's NZX-50 added 0.6%.

More from WSJ:

The Taiwan dollar rose to its highest since May 18, trading at NT$31.879 per dollar. The Australian dollar rose to its highest against the yen since May 18, at 79.89 yen. The Indonesia rupiah was at highest since May 10 against the greenback, trading at IDR9,030.