China's yuan rises to 3-week high

The Chinese yuan rose to three-week high against the US dollar on Friday.

The central parity rate of the yuan strengthened 173 basis points to 6.8456 against the US dollar, edging up for the fourth consecutive day, according to the China Foreign Exchange Trade System.

In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 per cent from the central parity rate each trading day, Xinhua news agency reported.

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.

Zhu Jun, head of the international department at the central bank, dismissed the likelihood of substantial adjustment of the yuan.

Zhu said that the yuan had fallen around 13 per cent against the US dollar compared with its high point, which was already a significant drop, and that the country's healthy international balance of payments would support the yuan's strength.

Overnight, the US dollar traded lower against most major currencies amid uncertainties over the timing of Federal Reserve's next rate-hike.

The dollar index, which measures the greenback against six major peers, was down 0.67 per cent to 100.5 in late trading.

At her testimony before the Congress on Wednesday, Fed Chair Janet Yellen signalled more than two rate-hikes this year as the US economy continued to make progress toward the maximum employment and price stability objectives.

--IANS

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