Guided by a series of weaker PBOC fixes, spot yuan hit its lowest level in nearly 4-1/2 years last week, raising questions about how much the central bank intends to let it depreciate against the dollar The spot rate is allowed to trade within a range 2 percent above or below the official fixing on any given day.
The exchange, the China Foreign Exchange Trade System (CFETS), a unit of the central bank, announced after the market close on Friday that it had launched a new trade-weighted yuan exchange rate index, in a move that some traders said may suggest Beijing will allow the yuan to weaker further.