China’s Yuan Nudges Higher Against U.S. Dollar
(MENAFN) The Chinese currency, the renminbi (yuan), advanced on Tuesday as the China Foreign Exchange Trade System (CFETS) announced that the central parity rate had risen by 25 pips to 7.0856 per U.S. dollar.
Under China’s managed floating exchange rate system, the yuan can fluctuate within a 2 percent band—either appreciating or depreciating from the daily central parity rate—during each trading session in the domestic foreign exchange market.
According to CFETS, the central parity rate of the yuan against the dollar is determined by a weighted average of quotes submitted by market makers before the interbank market opens each business day. This mechanism is designed to reflect supply and demand dynamics while maintaining overall market stability.
Tuesday’s adjustment underscores ongoing efforts by Chinese monetary authorities to stabilize the currency amid shifting global financial conditions and fluctuations in the U.S. dollar index. Analysts note that such incremental movements are closely monitored as indicators of Beijing’s broader policy stance toward exchange rate flexibility and capital market management.
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