China's yuan closed weaker to the dollar on Friday, as the US currency gained momentum on global markets. The yuan, which was revalued by 2.1 percent on July 21 to 8.11 per dollar, closed at 8.0806 versus 8.0798 on Thursday.
Dealers blamed the yuan's softness on the strength of the dollar, which traded near a two-and-a-half-year high against the yen and within range of a two-year peak versus the euro on Friday, as the tepid outlook for euro zone interest rates ensured the greenback's rate advantages was intact.
The yuan, which chalked up a post-revaluation closing high of 8.08796 on Tuesday, has now appreciated a further 0.36 percent since the big policy move in July.
Analysts said the yuan would continue to follow the movement of major global currencies, while treading slowly but steadily upward.
"The yuan's move is almost tied to global markets," said a dealer with a major foreign bank. "The link will only get closer as long as the central bank stays out of the market."
On Friday, one-year onshore yuan forwards were quoted at 7.7829 per dollar, anticipating that the yuan would be 3.8 percent stronger in a year's time. Four deals were done.
The yuan strengthened against the euro to close at 9.4727 versus 9.5155 on Thursday, and also firmed to 6.6954 per 100 yen from 6.7350, the central bank said on its Web site.
Comments
Comments are closed.