SHANGHAI: China's yuan edged slightly lower on Wednesday morning, although the central bank fixed the mid-point near a record high again ahead of the Group of 20 summit.
The People's Bank of China set the mid-point at 6.3297 versus the dollar before trading started, compared with 6.3293 on Tuesday and the record high of 6.3233 on Monday.
Traders attributed the firm fixing to Beijing's intention to guide its currency up before a gathering of the world's top leaders in France on Nov. 3-4 to discuss how they can contain the euro zone debt crisis.
"The high mid-points fuelled market expectations for a stronger yuan," said a Shanghai-based trader at a Chinese bank.
However, some big banks bought dollars from the market to support China's imports of crude oil and Chinese firms' investments abroad at the beginning of the month, driving up the dollar/yuan exchange rate, which can move up or down 0.5 percent from the mid-point in each trading day.
The yuan briefly traded below 6.35 as trading began, but weakened to levels above 6.35 versus the dollar afterwards and stood at 6.3551 by midday, from Tuesday's close of 6.3543.
The Chinese currency has gained 3.69 percent against dollar so far this year. It resumed appreciation in October, moving up 0.49 percent, after losing 0.12 percent in September.
Offshore, spot yuan strengthened to trade at 6.3900 versus the dollar at midday, from Tuesday's close of 6.4100.
The one-year non-deliverable forwards moved up slightly to 6.3695, after it ended at 6.3750 on Tuesday.
That implied a depreciation of 0.6 percent in a year's time versus a depreciation of 0.72 percent on Tuesday.
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