The yuan ended down slightly against the dollar on Monday, as the People's Bank of China set a weaker mid-point in the wake of the dollar's rebound in global markets. Dealers said the PBOC was showing initiative to keep the yuan in a small range as China's economic recovery was not on solid footing.
The PBOC set the yuan's mid-point, or its reference rate from where the yuan could rise or fall 0.5 percent in a day, at 6.7989 to the dollar, down from Friday's 6.7884, guiding spot yuan to close at 6.8003 versus the dollar, down from Friday's close of 6.7902. The yuan rose as high as 0.91 percent against the dollar since it was depegged on June 19, but it now stands only 0.38 percent higher. Benchmark one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.6819 late on Monday, up slightly from Friday's close of 6.6775. Their implied future yuan appreciation rose to 1.75 from Friday's 1.66 percent.
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