The yuan ended slightly lower versus the dollar on Monday after the People's Bank of China set a weaker mid-point, in line with a strong dollar as investors fretted about the euro debt crisis. Spot yuan closed at 6.4687 versus the dollar, slightly lower than Friday's close of 6.4630. It hit an all-time intraday trading high of 6.4563 on Thursday.
It has now appreciated 5.53 percent since it was depegged from the dollar in June 2010 and 1.87 percent so far this year. Before trade began, the PBOC fixed the yuan's mid-point at 6.4680 versus the dollar, marginally weaker than Friday's 6.4665.
Offshore, benchmark one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.4075 by late trade, up from 6.3965 at the previous close. Their implied yuan rise in a year's time fell to 0.94 percent from 1.12 percent.
NDFs have generally underestimated the potential for yuan appreciation since the start of this year due to factors such as betting on a stronger-than-expected US economic recovery.