Beijing has told Washington it will cancel Xi Jinping's September 24 White House visit if the United States proceeds with a new Taiwan arms sale, a threat that reads, on the diplomatic track, as leverage over a summit calendar. It is that. But the more useful reading sits with the PBOC's open-market desk, which has spent the weeks since the Bali framework was floated managing yuan liquidity on the assumption that a Xi visit produces a tariff detente worth pricing into year-end guidance. The desk cannot hedge a cancellation the way the State Department can absorb a delayed meeting.

The PBOC's open-market operators do not set the arms-sale calendar, or, more precisely, they do not control the Pentagon's Foreign Military Sales notification clock that Congress reviews on its own fixed timetable, but they do control how much yuan liquidity gets released against the expectation of a September 24 handshake. If the visit is cancelled, that liquidity plan reverts to the tighter posture Premier Li's economic working group was running before the summit was scheduled, the posture built around a tariff resolution that has not arrived on its own terms. The PBOC's open-market desk has until its next scheduled liquidity operation, ahead of the September 24 date itself, to decide whether it is still underwriting a summit that Beijing has now made conditional on a Pentagon notification neither side controls.