Chinese yuan continues to strengthen against USD

Source: Xinhua| 2018-02-27 11:36:56|Editor: pengying
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BEIJING, Feb. 27 (Xinhua) -- The Chinese currency renminbi, or the yuan, remained strong Tuesday as its central parity rate against the greenback strengthened for a third trading day.

The yuan's rate appreciated by 232 basis points to 6.3146 against the U.S. dollar Tuesday, the biggest gain since the beginning of this month, according to the China Foreign Exchange Trade System. The onshore and offshore yuan also rallied.

The performance was attributable to a weak U.S. dollar, which still lacks gaining momentum despite support from market speculations for as many as three rate hikes by the Federal Reserve this year.

Meanwhile, the yuan has been stable due to sound economic fundamentals, solid expectations, and balanced supply and demand. The first month of 2018 saw the yuan's central parity rate gain more than 3 percent against the U.S. dollar.

Analysts believe the yuan's exchange rate will maintain stable in the long term with more "two-way movement."

In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.

The central parity rate of the yuan against the U.S. dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.