SHANGHAI: China's yuan slipped on Thursday, guided lower by a weaker central bank fixing and as the dollar extended its rebound from a three-year trough.

The greenback rose against major peers on Thursday, supported by higher US yields, as President-elect Joe Biden prepared to outline his plans for massive fiscal stimulus.

The People's Bank of China set its midpoint rate for the currency at 6.4746 per dollar prior to market open, 141 pips weaker than the previous fix of 6.4605.

The spot market opened at 6.4688 per dollar and was changing hands at 6.4718 at midday, 37 pips weaker than the previous late session close.

Traders said China's better-than-expected trade data did not provide much support for the yuan, as the country's comparative economic advantage could fade as the global COVID-19 vaccine rollout helps revive demand elsewhere.

China's exports grew more than expected in December, albeit at a slower pace than the month before, as global demand for its goods remained solid, while import growth quickened, customs data showed on Thursday.

"The dollar index could rise further in the short-term, putting pressure on the yuan, thanks to good news around the vaccine progress and rosier expectations of a global economic recovery," said a trader at a foreign bank.

China needs to innovate its monetary policy tools and improve policy transmission mechanisms to strengthen its international macroeconomic policy coordination, a central bank official said in a research report on Wednesday.

Eyes were also on Sino-US tensions.

The Trump administration has scrapped plans to blacklist Chinese tech giants Alibaba, Tencent and Baidu, four people familiar with the matter said, providing a brief reprieve to Beijing's top corporates amid a broader crackdown by Washington.

The Thomson Reuters/HKEX Global CNH index, which tracks the offshore yuan against a basket of currencies on a daily basis, stood at 95.98, firmer than the previous day's 95.97.

The global dollar index rose to 90.405 from the previous close of 90.296.

The offshore yuan was trading at 6.4675 per dollar.

Offshore one-year non-deliverable forwards contracts (NDFs), considered the best available proxy for forward-looking market expectations of the yuan's value, traded at 6.6023, -1.93% away from the midpoint.

One-year NDFs are settled against the midpoint, not the spot rate.