BEIJING, Jan. 24 — The central parity rate of the Chinese currency renminbi, or the yuan, strengthened for the fourth consecutive trading day, surging beyond 6.4 against the U.S. dollar for the first time since Dec. 7, 2015.
The central parity rate of the yuan strengthened 93 basis points to 6.3916 against the U.S. dollar, according to the China Foreign Exchange Trade System.The rise came after the yuan advanced 103 basis points to reach 6.4009 against the U.S. dollar Tuesday.Since the beginning of this year, the yuan has strengthened by more than 2 percent against the dollar.
A weaker dollar has been contributing to the yuan’s robust performance, despite solid growth expected in the U. S. economy in 2018, according to a report issued by China International Capital Corporation.The U.S. dollar index, a measure of the value of the dollar against a basket of foreign currencies, has dropped over 2 percent since the beginning of 2018.
The yuan is also supported by stable and steady growth of China’s economy, according to Huang Zhilong, senior researcher at Suning Institute of Finance.China’s economy expanded 6.9 percent last year, picking up for the first time in seven years and well above the government’s annual target of around 6.5 percent.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. – XINHUA