The yuan closed lower versus the dollar on Thursday, pulling off a record trading high hit a day earlier, as the People's Bank of China fixed a mid-point significantly lower in the wake of an overnight rally in the US Dollar Index. The weak PBOC fixing, from which dollar/yuan can rise or fall 0.5 percent in a day, coincided with the posting of China's weak trade data for October, which analysts said would likely ease pressure for the yuan to appreciate.
Spot yuan closed at 6.3459 versus the dollar, down from 6.3402 at the close on Wednesday when it hit an all-time peak of 6.3365 in intraday trading. Offshore, one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.3370, little changed from 6.3340 at the close on Wednesday. They now implied that the yuan would largely remain unchanged in 12 months from Thursday's PBOC mid-point. Offshore dollar/yuan forwards have typically forecast yuan appreciation in the past few years. But it has largely implied yuan depreciation since a rally in the dollar in September.
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