Yuan Hits Year-to-Date Low Against Dollar to Close First Half
Xu Wei
DATE:  Jun 29 2018
/ SOURCE:  Yicai
Yuan Hits Year-to-Date Low Against Dollar to Close First Half Yuan Hits Year-to-Date Low Against Dollar to Close First Half

(Yicai Global) June 29 -- The Chinese yuan continued to weaken against the dollar today, marking a new low since Dec. 13 on the last trading day of the first half.

The People's Bank of China set the central parity rate of the yuan against the greenback at 6.6166 this morning, 206 pips weaker than yesterday, according to the China Foreign Exchange Trading System and National Interbank Funding Center.

The rate, which governs the spot exchange rate, has now fallen for eight straight business days and slumped below the 6.6 mark for the first time this year. The currency performed well over the first four months of the year, but has finished the first half down 1.26 percent against the dollar.

Policy tightening at the end of last year has caused market concerns over growth, which could be one of the main factors behind the tumbling yuan, according to a report by China International Capital. The key to stabilization is to calm expectations for domestic growth and inflation, it added, warning that weak policy adjustments could continue to deteriorate market sentiment.

The central bank sets the parity rate on the morning of each business day, and spot rates may deviate 2 percent above or below the figure.

The offshore yuan, which his not controlled by PBOC, stumbled out of the gate and hit 6.6523 in morning trading, but gained traction later in the day to 6.6308 at 4.05 p.m. Beijing time, 53 pips stronger than yesterday's close.

Editor: James Boynton

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Keywords:   Dollar,Yuan,Exchange Rates,Forex,Parity Rate