Prior to the market opening, the People's Bank of China (PBOC) set the midpoint rate at 6.4765 per dollar, 48 pips or 0.07% weaker than the previous fix of 6.4717
The dollar eased to 109.24 yen, having lost about 1% over the past two sessions while the euro slipped to as low as 128.50 yen, touching its lowest level since late March
The US currency was underpinned by data, released on Thursday, showing US producer prices posted their largest annual increase in more than a decade in the 12 months through July
Different easing approaches could have different impact on the financial markets, and monetary easing could put downside pressure on the yuan in the short term
Many analysts said the interest rate cut was an adjustment to monetary policy objectives, which was inconsistent with the policy tone, hence chances of such a move were very low
Sun maintained his forecast for the yuan to trade in a range of 6.45 to 6.49 per dollar for the near time, with some upside risks to the Chinese currency
"The overarching point is that there is a shifting balance of risks on the renminbi towards a less positive outlook, even as important fundamental tailwinds remain," Tan said
"CGBs provide diversification benefits, while there was also the RRR cut in the month which had supported the bond market sentiment," strategists at OCBC Bank said in a note