SHANGHAI: China's yuan softened against the dollar on Tuesday for the fourth straight day after the central bank set a weaker midpoint and in response to weak foreign direct investment (FDI) figures.
The People's Bank of China set the midpoint at 6.1462 per dollar prior to market open, down 0.02 percent from the previous fix. The spot rate is currently allowed to trade 2 percent above or below the midpoint.
Spot yuan opened at 6.1501 per dollar, and was changing hands at 6.1481 by midday, down 0.10 percent from the previous close.
China drew $78.3 billion in FDI in the first eight months of 2014, down 1.8 percent from a year earlier. In August alone, the figure was $7.2 billion, down 14 percent from a year earlier, and at a level not seen in at least 2-1/2 years.
Increasing risk of an export slowdown was also seen weighing on the Chinese currency, traders said.
Shen Danyang, trade ministry spokesman, said on Tuesday that China's exports may not be able to sustain high growth in the months to come although the country's trade situation was stabilising.
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