The yuan finished down against the dollar on Friday after the People's Bank of China set a weaker mid-point, in the wake of a jump in the US dollar index in global markets. But the mere 19-pip fall in the PBOC's mid-point, or the level from which the yuan may rise or fall 0.5 percent each day, lagged far behind a jump of 0.8 percent in the dollar index on Thursday.
Dealers said that may reflect the central bank's intention to keep the yuan in a narrow range. Dealers said the domestic market would await fresh leads for direction as the Chinese currency has already jumped around 3.5 percent since it was depegged in June. Spot yuan closed at 6.6280 versus the dollar at midday, down from Thursday's close of 6.6265. It has risen 2.99 percent since its mid-June depegging.
Before trade began, the Chinese central bank fixed the yuan's mid-point versus the dollar at 6.6341, weaker than Thursday's 6.6322. Benchmark one-year non-deliverable dollar/yuan forwards were bid at 6.4610. Their implied yuan appreciation in a year's time rose slightly to 2.68 percent from 2.58 percent.