Chinese Yuan weakens against US dollar on Tuesday
Date
5/28/2024 9:12:08 AM
(MENAFN) On Tuesday, the central parity rate of the Chinese currency renminbi, commonly known as the yuan, exhibited a slight weakening, declining by 10 pips to 7.1101 against the U.S. dollar, as reported by the China Foreign Exchange Trade System. This adjustment reflects the ongoing dynamics in China's spot foreign exchange market, where the yuan is permitted to fluctuate within a 2 percent band around the central parity rate on a daily basis.
The central parity rate of the yuan against the U.S. dollar is determined based on a weighted average of prices provided by market makers prior to the commencement of trading in the interbank market each business day. This mechanism allows for a transparent and market-driven approach to setting the reference exchange rate, taking into account the prevailing conditions and sentiments in the currency market.
The slight depreciation of the yuan against the U.S. dollar observed on Tuesday underscores the complexities of foreign exchange dynamics and the interplay of various factors influencing currency valuations. Such fluctuations are closely monitored by market participants, policymakers, and analysts, as they can have implications for trade competitiveness, capital flows, and overall economic stability.
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