Chinese yuan weakens further, hits six-year low

Chinese yuan weakens further, hits six-year low

Beijing, Oct 17 (IANS) The central parity rate of the Chinese yuan continued to weaken on Monday, hitting a six-year low against the US dollar.

The central parity rate weakened by 222 basis points to 6.7379 against the dollar, Xinhua news agency cited China Foreign Exchange Trade System (CFETS) as saying.

It was the lowest level since September 2010.

In China’s spot foreign exchange market, the yuan is allowed to rise or fall by two per cent from the central parity rate each trading day.

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

The weakness in the yuan is a reflection of the dollar’s strength. The US dollar index, which measures the greenback against six major currencies, hit a seven-month high early on Monday following positive economic data from the country.

The yuan has now weakened against the dollar for nine trading days in a row, aside from a strengthening on Friday, as increased market expectations for an interest rate hike in the US have led to a stronger dollar.

In a commentary published last week on the CFETS website, which is run by the People’s Bank of China, the central bank said: “There is no basis for the yuan to depreciate in the long term.” It cited China’s long-term current account surplus, abundant forex reserves, sound fiscal conditions and healthy financial system.

It is normal for the yuan to fluctuate against the dollar, and it will continue to do so, the commentary said.

Leave a Reply

Please enter your comment!

The opinions, views, and thoughts expressed by the readers and those providing comments are theirs alone and do not reflect the opinions of or any employee thereof. is not responsible for the accuracy of any of the information supplied by the readers. Responsibility for the content of comments belongs to the commenter alone.  

We request the readers to refrain from posting defamatory, inflammatory comments and not indulge in personal attacks. However, it is obligatory on the part of to provide the IP address and other details of senders of such comments to the concerned authorities upon their request.

Hence we request all our readers to help us to delete comments that do not follow these guidelines by informing us at Lets work together to keep the comments clean and worthful, thereby make a difference in the community.

Please enter your name here