China's yuan eased on Thursday, as corporate dollar demand rose as the end of the half-year approached, traders said. The People's Bank of China (PBOC) weakened the midpoint rate slightly for a third consecutive session, setting it at 6.1148 per dollar prior to market open, compared with the previous fix at 6.1142. The spot market opened at 6.2074 per dollar and was changing hands at 6.2087 at midday, down 0.03 percent from the previous close.
Seasonal demand for dollars from Chinese state-owned companies typically increases in June as they ready to pay dividends to overseas shareholders, traders said. "Except from the seasonal factor, the market is relatively bearish towards the yuan of late," said a trader at an Asian bank in Shanghai. But she quickly added that the yuan is unlikely to weaken past the 6.22 per dollar level in the short term as dealers suspect that the central bank show support at that level. The rate of the offshore yuan roughly matched the onshore spot at 6.2085 per dollar.