SHANGHAI: China's yuan edged down on Thursday after the central bank ignored gains in the dollar against other currencies to set its dollar-yuan midpoint, signalling a preference for stability.
The People's Bank of China (PBOC) fixed its midpoint at 6.1698 per dollar on Thursday, only 0.03 percent weaker than Wednesday's 6.1677, despite an overnight jump of nearly 1 percent in the dollar index.
"According to the central bank's past operating style, it would be natural for it to set the midpoint above 6.17 after dollar jump, so it (today's midpoint) perhaps indicated the central bank's intention to keep the yuan in a narrow range," said a dealer at a city commercial bank in Shanghai.
Spot yuan changed hands at 6.1289 in late morning, 0.03 percent softer than Wednesday's close.
But as they have in recent days, dealers continue to report resilient yuan demand, and the currency remains only 0.14 percent weaker than its all-time high of 6.1210 hit on July 3.
Some dealers said they yuan could fall slightly next week as some corporate clients listed in Hong Kong or other markets will need to purchase foreign currency to offer dividends around end-June and early July. That will offset some of the current yuan demand.
Comments
Comments are closed for this article.