SHANGHAI: The yuan weakened on Thursday, tracking a global dollar rally, But losses were limited amid signs that the People's Bank of China (PBOC) will hold the Chinese currency mostly stable due to uncertainties in global currency markets, traders said. Spot yuan was trading at 6.2417 per dollar at midday, down 0.07 percent from 6.2376 at Wednesday's close. Volume fell to a thin $5.05 billion on Thursday morning from a heavy $13.52 billion on Wednesday morning, partly because the dollar strength dampened enthusiasm for firms to sell dollars, traders said. Before trading began, the PBOC set the yuan's midpoint at 6.2846, 0.07 percent weaker than Wednesday's midpoint of 6.2804, as the PBOC responded to a 0.8 percent rally in the dollar index overnight. Caution has increased since the weekend, when a statement by G20 policymakers did not single out Tokyo for its polices that have depressed the yen. The market largely interpreted the G20 statement as de facto acceptance of Japan's recent expansionary monetary policies. "The PBOC typically tries to control the pace of yuan appreciation and depreciation during global financial and economic uncertainties," said a trader at a major Chinese commercial bank in Shanghai. "Recent midpoints have again shown signs of such moves by the PBOC, and that understanding has helped kept the yuan relatively stable these days."

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