(Yicai Global) March 9 -- The onshore Chinese yuan exchange rate against the US dollar slipped to a new low for 2021 today at 6.5445 as the greenback rally shows no sign of losing steam.

The Chinese yuan depreciated by 543 basis points today from yesterday to a central parity rate of 6.5338 against the US dollar in the largest one-day drop since July 20, 2018, according to the China Foreign Exchange Trade System. This is the weakest it has been this year since Jan. 4.

Once the central parity rate, which is the weighted average of prices offered by markets at the beginning of each day, slid below 6.50 yesterday, there was a big surge in foreign exchange purchases, The Paper reported.

The yuan-dollar exchange rate will face further pressure if the dollar continues to strengthen, the report said, citing a foreign exchange trader with a joint-stock bank.

The offshore yuan-dollar exchange rate, which better reflects the expectations of international investors, climbed to 6.5616 today, the highest since December last year.

The greenback’s sharp gains are largely due to a big jump in the yield of US 10-year Treasury bonds. The dollar index appreciated 2.63 percent in the international foreign exchange market between Feb. 25 and March 8 and today reached 92.50. In the five trading days from March 2 to March 8 the offshore redback lost 1.4 percent in value against the dollar.

Editor: Kim Taylor