* PBOC sets slightly stronger yuan mid-point * Senior officials stress yuan stability * Market guesses pause in yuan rise on the cards * Yuan at 6.3740, up 3.38 pct so far this year By Lu Jianxin and Jacqueline Wong SHANGHAI, Oct 17 (Reuters) - The yuan edged up against the dollar on Monday but traded below the Chinese central bank's mid-point as the market is wary that the government may engineer a pause in yuan appreciation amid unstable global economic and market conditions. The People's Bank of China fixed its daily mid-point slightly stronger on Monday after it set the fixing weaker for three straight days late last week after the U.S. Senate approved a controversial bill on Tuesday aimed at forcing Beijing to push the yuan higher against the dollar. Chinese Vice Premier Li Keqiang late on Friday made Beijing's highest level public warning yet against the U.S. Congress bill aimed at the yuan, telling former U.S. Secretary of State Condoleezza Rice that the bill could hinder global recovery. And state media on Saturday quoted Premier Wen Jiabao as telling businessmen that the yuan's exchange rate would remain stable to protect exporters. "It appears China is increasingly worried about the impact of the slowing global economy on its exports," said a trader at a Chinese state-owned bank in Beijing. "Adding to worries is the U.S. politically-motivated yuan bill, so it won't be a surprise if China pauses yuan appreciation which has been seen for the bulk of this year." Spot yuan was trading at 6.3740 at midday, up slightly from Friday's close of 3.3785. It has now risen 3.38 percent since the start of this year and 7.09 percent since it was depegged from the dollar in June 2010. Before trading began, the PBOC set the mid-point of the day at 6.3710 compared with Friday's 6.3762. The central bank uses the reference rate to signal the government's intentions for the yuan, which could rise or fall 0.5 percent from the mid-point in a day. China has mostly let the yuan appreciate steadily this year partly to help in its battle against imported inflation. But more recently since May, global commodity prices have fallen sharply amid a rally in the U.S. dollar. While the Chinese government paints a picture of resisting U.S. calls for a stronger yuan, it has made political concessions when tensions escalated in the past. More typically, Beijing has let the yuan appreciate intermittently ahead of major political events such as the meeting of the two nations' leaders and publication of the U.S. Treasury's currency reports typically in April and October. The Treasury Department said on Friday it would delay until later this year a ruling on whether China is manipulating its currency as Democratic Party lawmakers tried to overcome Republican opposition to the bill targeted at the yuan. The sixth semiannual report to Congress under the Obama administration was originally due on Saturday. Offshore, one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.3875 in morning trade, falling slightly from 6.3900 at the close on Friday. They implied yuan depreciation of 0.26 percent in 12 months from Monday's PBOC mid-point, compared with depreciation of 0.30 percent they implied on Thursday.

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