China Yuan Fixed At New High For 4th Day In Row
The fixing marked the fourth straight record high for the Chinese unit against the greenback, beating Tuesday's 6.7378. The string of new highs comes as the United States has increased pressure on Beijing in the last week to allow the yuan to rise faster.
The yuan finished at 6.7463 against the U.S. dollar on the over-the-counter (OTC) market Tuesday, higher than Monday's close of 6.7618.
The yuan has seen increased volatility in the trading days since the PBOC's June 19 pledge to increase exchange rate flexibility. The yuan has risen by 1.48% since that pledge was made.
Based on today's parity, the yuan is up 1.52% from a year earlier against the dollar, according to Market News International calculations.
The yuan fell 0.06% in 2009 as the government continued to hold the Chinese unit virtually pegged to the U.S. dollar, despite growing international criticism about its exchange rate policy. It fell 0.48% in August and has risen 1.49% so far this year.
Last year marked the first that the yuan has fallen against the dollar since being depegged in 2005. The paltry move against the dollar last year compares with the 7.05% rise in 2008 and the 6.86% jump seen in 2007.
Today's fixing brings the yuan's gains against the greenback to 23.06% since currency reforms were announced on July 21, 2005, including that day's one-off 2.1% revaluation.
The yuan was set weaker against the euro and the yen today.
The PBOC set the yuan parity against the euro at 8.7499 today, down from the 8.6561 fixing the previous trading day. The yuan is up 12.47% y/y against the euro based on today's fixing.
The yuan depreciated 1.41% against the euro last year, a dramatic shift from its 10.43% jump in 2008.
The yuan was also fixed at 8.0941 to the Japanese yen, down from the previous session's 8.0833. The yuan is down 7.92% y/y against the yen based on today's fixing.
The Chinese currency rose 2.53% against the Japanese yen in 2009, a turnaround from 2008's 15.32% depreciation.
The People's Bank of China started setting a daily central parity rate on Jan. 4, 2007.
On July 21, 2005, China freed the yuan from its longstanding peg to the dollar in favor of a managed float with reference to a basket of currencies.
On May 21, 2007, the PBOC widened the daily fluctuation band for the yuan-dollar exchange rate to 0.5% from 0.3% on either side of the central parity rate.
