Monday, 24 October 2011 at 11:03, Reuters, Shanghai
Spot yuan was trading at 6.3732 versus the dollar in afternoon trade, up from Friday's close of 6.3840. (AFP)
The yuan rose versus the dollar on Monday after the People's Bank of China set a higher mid-point in the wake of a 0.8 per cent fall in the US Dollar Index .
Dealers said the Chinese currency could edge up ahead of the summit of the Group of 20 major developed and emerging economies in France on November 3 and 4. The yuan had risen before the US Senate granted approval to a bill aimed at pressing China to let the yuan appreciate faster on October 11.
"Today's rise is largely because of the weak dollar," said a dealer at a Chinese commercial bank in Shanghai. "But we think the yuan still has potential to rise, especially before the summit."
Spot yuan was trading at 6.3732 versus the dollar in afternoon trade, up from Friday's close of 6.3840. It has risen 3.40 per cent so far this year and 7.11 per cent since it was depegged from the dollar in June 2010.
Before trading began, the PBOC set the mid-point of the day at 6.3549, stronger than Friday's 6.3628. The central bank uses the fixing to signal the government's intentions for the yuan.
China had let the yuan rise as much as four per cent versus the dollar from the beginning of this year to Tuesday October 11 - just ahead of the US Senate's approval of its yuan bill.
Offshore, one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.4020 in midday trade, down slightly from 6.4080 at the close on Friday.
They implied yuan depreciation of 0.74 per cent in 12 months from Friday's PBOC mid-point, compared with depreciation of 0.84 per cent they implied on Friday.
Your comments