WSJ:China Yuan Up Late on PBOC Guidance, Euro's Gains
Vs Parity Previous
USD/CNY Central Parity 6.3325 6.3381
USD/CNY OTC 0830 GMT 6.3807 +0.76% 6.3841
High 6.3811 +0.77%
Low 6.3762 +0.69%
SHANGHAI--China's yuan rose against the U.S. dollar late Friday as the central bank guided the Chinese currency higher after the euro extended its gains overnight, though the yuan's rise was capped by expectations that companies may start buying dollars at the end of the month to settle accounts.
On the over-the-counter market, the dollar was at CNY6.3807 around 0830 GMT, lower than Thursday's close of CNY6.3841. It traded in a range of CNY6.3762 to CNY6.3811.
The People's Bank of China set the dollar/yuan central parity rate at 6.3325, lower than Thursday's 6.3381, as the euro rose to a two-week high Thursday after European Central Bank President Mario Draghi said the central bank would do whatever it takes to preserve the common currency.
However, the euro's gains didn't lift the yuan much as investors expected oil companies and auto companies would enter the market to buy substantial amounts of dollars at the end of the month, as they usually do.
"People are very cautious in shorting the dollar as the corporates who usually buy lots of dollars at month-end haven't shown up yet," said a Shanghai-based trader with a foreign bank.
Offshore, one-year dollar/yuan nondeliverable forward contracts were at 6.4340/6.4360 from 6.4335/6.4370 late Thursday, implying a 0.8% fall by the yuan over the next year.
In the offshore yuan market in Hong Kong, where the Chinese currency floats freely, the dollar was at CNY6.3805, lower than CNY6.3863 late Thursday.
