China's yuan finished at a post-revaluation closing high against the dollar on Wednesday for the second consecutive day, boosted by a weaker dollar and pressure before the Chinese President's visit to the United States later in the month.
The yuan closed at 8.0087 against the dollar from Tuesday's close of 8.0160, after the central bank set the yuan's daily mid-point exchange rate at a stronger 8.0116 versus 8.0194 a day earlier.
The currency hit a high of 8.0070 in intraday trade, the highest level since Beijing revalued it by 2.1 percent and freed it from a dollar peg to float within managed bands. At that level, it has appreciated a further 1.3 percent since the ground-breaking policy change.
"There has been a large volume of dollar selling throughout the day," said a trader with a major foreign lender, blaming it on a weak greenback which fell to two-month lows against the euro the previous day.
Political pressure from Washington also played a role in pushing up the yuan in the run-up to President Hu Jintao's April 20 US trip during which the currency issue could feature high on the agenda, the trader added.
China's trading partners, especially the United States, have been urging Beijing to let the yuan appreciate more quickly, saying an undervalued currency gives China an unfair export edge.
The yuan could continue to chalk up new highs before Hu's US visit, he said, possibly challenging the key 8.0000 level.
One-year onshore yuan forwards were quoted at 7.7505 to the dollar by Wednesday's close, anticipating the yuan would be 3.37 percent stronger in one year's time.
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