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China’s yuan shows weakening against US dollar on Monday
(MENAFN) On Monday, the central parity rate of the Chinese currency, the renminbi (yuan), depreciated by 46 pips, settling at 7.1316 against the U.S. dollar, according to data from the China Foreign Exchange Trade System. This adjustment reflects the ongoing fluctuations in the currency exchange rates as influenced by various market factors and economic conditions.
In the spot foreign exchange market in China, the yuan is permitted to fluctuate by up to 2 percent above or below the central parity rate each trading day. This trading band allows for a degree of flexibility in the yuan's value, enabling it to respond to market pressures while maintaining a structured exchange rate framework.
The central parity rate of the yuan against the U.S. dollar is determined based on a weighted average of prices submitted by market makers prior to the opening of the interbank market each business day. This method ensures that the parity rate reflects a broad consensus among major financial institutions and helps in establishing a benchmark for currency trading.
Overall, the central parity rate serves as a reference point for the daily trading range of the yuan in the foreign exchange market, and its fluctuations are influenced by both domestic and international economic developments. The system aims to balance market stability with the flexibility needed to accommodate changing economic conditions and investor sentiments.
In the spot foreign exchange market in China, the yuan is permitted to fluctuate by up to 2 percent above or below the central parity rate each trading day. This trading band allows for a degree of flexibility in the yuan's value, enabling it to respond to market pressures while maintaining a structured exchange rate framework.
The central parity rate of the yuan against the U.S. dollar is determined based on a weighted average of prices submitted by market makers prior to the opening of the interbank market each business day. This method ensures that the parity rate reflects a broad consensus among major financial institutions and helps in establishing a benchmark for currency trading.
Overall, the central parity rate serves as a reference point for the daily trading range of the yuan in the foreign exchange market, and its fluctuations are influenced by both domestic and international economic developments. The system aims to balance market stability with the flexibility needed to accommodate changing economic conditions and investor sentiments.
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