China raises yuan official rate against dollar to 2.5-month high

TOKYO, China’s central bank on Wednesday raised the central parity rate for the Chinese yuan (renminbi) against the US dollar to the strongest level in two-and-half-month high. The People’s Bank of China set the central parity rate, an official reference for daily trading, at CNY 6.8476 per dollar, up 463 basis points from Tuesday, according to the China Foreign Exchange Trading System. The midpoint advanced for the second consecutive day, marking the strongest level since Sept. 25.

China strictly controls trading of the yuan, as the central bank sets the central parity rate every morning and restricts the currency to rise or fall up to two percent from the rate.

Currently, the yuan’s exchange rate is showing greater flexibility in two-way fluctuation, with exchange rate expectation staying generally stable, China’s central bank governor Yi Gang said in an article, state-run Xinhua News reported.

“The yuan’s exchange rate remains generally stable at a reasonable level near its equilibrium,” Yi was quoted as saying. The central parity rate of the yuan against the US dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.

Source: Kuwait News Agency