LINE

Text:AAAPrint
Economy

Chinese yuan weakens to 6.5277 against USD Tuesday after 11 day increase

1
2017-09-12 14:25Xinhua Editor: Gu Liping ECNS App Download

The central parity rate of the Chinese currency, the yuan, weakened against the U.S. dollar Tuesday after a relaxation of controls on capital outflows.

The central parity rate of the yuan weakened 280 basis points to 6.5277 against the U.S. dollar, ending a record 11-day rise, according to the China Foreign Exchange Trade System.

In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.

The central parity rate of the yuan against the U.S. dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.

The dollar index, which tracks the greenback against a basket of six major currencies, was 0.66 percent higher at 91.957 on Tuesday.

Starting Monday, China's central bank scrapped reserve requirements of 20 percent for financial institutions settling foreign exchange forward yuan positions.

Meanwhile, the central bank's substantial supervision of reserves put aside by foreign financial institutions was also loosened.

The adjustment was made as the current market environment has changed significantly, which means counter-cyclical macro-prudential policies have given way to neutral monetary policy, said Sun Guofeng, head of the financial research institute affiliated to People's Bank of China.

The move will make it cheaper for companies and investors to buy dollars while selling the yuan, and thereby help ease the pace of the Chinese currency's recent rally, according to Lianxun Securities.

China is pursuing a prudent and neutral monetary policy in 2017, applying a full range of policy instruments to maintain basic stability in liquidity and hold interest rates at an appropriate level.

The correction of the yuan, however, does not necessarily mean its rising trend has been reversed, rather that the yuan-dollar exchange rate will probably achieve two-way fluctuations with improving flexibility, said Ying Xiwen, senior researcher of China Minsheng Bank.

  

Related news

MorePhoto

Most popular in 24h

MoreTop news

MoreVideo

News
Politics
Business
Society
Culture
Military
Sci-tech
Entertainment
Sports
Odd
Features
Biz
Economy
Travel
Travel News
Travel Types
Events
Food
Hotel
Bar & Club
Architecture
Gallery
Photo
CNS Photo
Video
Video
Learning Chinese
Learn About China
Social Chinese
Business Chinese
Buzz Words
Bilingual
Resources
ECNS Wire
Special Coverage
Infographics
Voices
LINE
Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.