Main­land China strength­ens yuan against US dol­lar, putting end to fall

The China Post - - INTERNATIONAL -

Main­land China’s cen­tral bank on Fri­day raised the value of the yuan against the U.S. dol­lar by 0.05 per­cent, the na­tional for­eign ex­change mar­ket said, end­ing three days of falls af­ter a sur­prise de­val­u­a­tion.

The daily ref­er­ence rate was set at 6.3975 yuan to $1.0, from 6.4010 the pre­vi­ous day, the China For­eign Ex­change Trade Sys­tem said.

The yuan closed at 6.3912 on Fri­day, strength­en­ing slightly from Thurs­day’s close of 6.3982.

The higher fix­ing for the yuan came af­ter main­land China’s Peo­ple’s Bank of China (PBoC) re­as­sured fi­nan­cial mar­kets by pledg­ing to seek a sta­ble cur­rency af­ter a shock de­val­u­a­tion of nearly two per­cent on Tues­day.

The cut, and two sub­se­quent re­duc­tions, sent global fi­nan­cial mar­kets into a tail­spin as it raised ques­tions over the health of the world’s sec­ond-largest econ­omy and sparked fears of a pos­si­ble cur­rency war.

Bei­jing said the move was the re­sult of switch­ing to a more mar­ket-ori­ented method of cal­cu­lat­ing the daily ref­er­ence rate which sets the value of the yuan, also known as the ren­minbi (RMB).

Pre­vi­ously, author­i­ties based the rate on a poll of mar­ket-mak­ers, but will now also take into ac­count the pre­vi­ous day’s close, for­eign ex­change sup­ply and de­mand and the rates of ma­jor cur­ren­cies.

The yuan is still only al­lowed to fluc­tu­ate up or down two per­cent on ei­ther side of the ref­er­ence rate.

Newspapers in English

Newspapers from Taiwan

© PressReader. All rights reserved.