China's yuan weakened slightly against the dollar on Thursday as the US currency advanced on the global market and the yuan consolidated Wednesday's largest single-day gain since revaluation. The yuan slid to 8.0204 against the dollar by Thursday's close, reversing a 0.18 percent gain on Wednesday when it closed at 8.0175.
The yuan has now appreciated a further 1.12 percent since its 2.1 percent revaluation last July. "The yuan rebounded yesterday due to stimulation from the central bank, which only had a temporary effect. The strengthening of the US dollar pressured the yuan rate today," said a trader with a foreign bank in Shanghai.
The dollar inched higher against most major currencies on Thursday on expectations that the US central bank will raise interest rates again in June. China's yuan had fallen to 8.0320 on Tuesday, its lowest level in more than nine weeks.
In a quarterly report on Wednesday, China's central bank reaffirmed its commitment to deepen foreign exchange reform to make the yuan more flexible, while keeping the currency "basically stable".
US Treasury Deputy Secretary Robert Kimmitt said on Thursday that China should speed up adjustment of its yuan exchange rate policy to reflect market conditions.
China's central bank said the daily mid-point of the yuan against the dollar was 8.0210 on Thursday, compared to Wednesday's mid-point of 8.0188.
The central bank limits the yuan to rising or falling 0.3 percent from its mid-point each day, but it has moved only a fraction of that range in most trading sessions since the floating rate regime was introduced when the currency was revalued last July.
Thursday's weakness moved the yuan further from its record close reached on May 15, when it briefly broke through 8.0000 per dollar to hit 7.9972 in intraday trade.
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