Vs Parity Previous
USD/CNY Central Parity 6.1380 6.1366
USD/CNY OTC 0830 GMT 6.0936 -0.72% 6.0932
High 6.0939 -0.72%
Low 6.0918 -0.75%
SHANGHAI--China's yuan fell against the U.S. dollar Friday, driven by dollar demand from corporates, although hopes that China's reform blueprint will put the country on a sustainable growth path helped to cap losses.
On the over-the-counter market, the dollar was at CNY6.0936 around 0830 GMT, higher than Thursday's close of CNY6.0932. It traded in a range of CNY6.0918 to CNY6.0939.
The People's Bank of China set the dollar/yuan central parity rate at 6.1380, higher than Thursday's 6.1366 following dollar strength overseas. The Wall Street Journal Dollar Index, which tracks the dollar against a trade-weighted basket of currencies, was at 73.551 late Thursday in New York, higher than 73.388 late Wednesday. At 0830 GMT, the index was at 73.495.
"There hasn't been much movement in the onshore yuan market for the past week, and those who want to bet on currency reforms have done it offshore instead," said a Shanghai-based trader at a foreign bank. China's leaders in a policy document last week said that the country is looking to open up its market further and will loosen controls on financial and currency markets.
"The offshore yuan has seen more volatility following the plenum meeting, but that's due more to speculative demand that is allowed overseas. Onshore, the banks and PBOC place curbs on such activity, that's why the USD/CNY has remained rangebound for the past week," the trader said. There has been some arbitrage activity as traders look to benefit from the gap between the value of onshore and offshore yuan, he added.
The yuan has risen 2.2% since the start of 2013.
Offshore, one-year dollar/yuan nondeliverable forward contracts rose to 6.1518/6.1555 from 6.1490/6.1520 late Thursday, implying a 1.0% 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 CNY6.0741 late Friday, higher than CNY6.0703 late Thursday.
