WSJ:China Yuan Steady as Investors Cut Dollar Positions Amid Higher Fixing
Vs Parity Previous
USD/CNY Central Parity 6.3459 6.3443
USD/CNY OTC 0830 GMT 6.3025 -0.68% 6.3020
High 6.3084 -0.59%
Low 6.3008 -0.71%
SHANGHAI--China's yuan was steady against the U.S. dollar late Thursday as investors continued to cut dollar positions before a long holiday next week, while the central bank guided the yuan lower via a daily reference rate.
On the over-the-counter market, the dollar was at CNY6.3025 around 0830 GMT, slightly higher than Wednesday's close of CNY6.3020. It traded in a range of CNY6.3008 to CNY6.3084.
"There is still heavy dollar selling in the market and any gains in the dollar are taken as a chance to sell," said a Shanghai-based trader with foreign bank.
Chinese companies and banks accumulated dollars when the yuan was depreciating earlier this year, and the trend has reversed and intensified after the U.S. Federal Reserve launched a new bond buying program.
The yuan declined by as much as 1.6% against the dollar between the start of the year and late July. It has since recovered and is now down about 0.1% since the start of the year.
The People's Bank of China set the dollar/yuan central parity rate at 6.3459, higher than Wednesday's 6.3443, after the euro fell to a two-week low against the dollar Wednesday.
Offshore, one-year dollar/yuan nondeliverable forward contracts fell to 6.4165/6.4195 from 6.4190/6.4220 late Wednesday, implying a 1.8% 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 CNY6.3125, higher than CNY6.3110 late Wednesday.
