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China’s yuan strengthens by 5 pips against US dollar on Tuesday
(MENAFN) On Tuesday, the central parity rate of the Chinese renminbi (yuan) against the U.S. dollar strengthened by 5 pips, reaching 7.1884, as reported by the China Foreign Exchange Trade System. This adjustment reflects a slight appreciation of the yuan in the foreign exchange market.
In China’s spot foreign exchange market, the yuan is permitted to fluctuate by up to 2 percent above or below the central parity rate each trading day, allowing for some flexibility in its value relative to the U.S. dollar. This daily fluctuation band helps manage the currency's exchange rate while maintaining a level of stability.
The central parity rate itself is calculated based on a weighted average of prices offered by market makers before the opening of the interbank market. This process occurs each business day and serves as the benchmark rate for the yuan against various foreign currencies, including the U.S. dollar.
The system ensures that the yuan’s value is adjusted according to market conditions while being closely monitored to prevent excessive volatility. It also plays a critical role in influencing the overall exchange rate dynamics between the yuan and other global currencies.
In China’s spot foreign exchange market, the yuan is permitted to fluctuate by up to 2 percent above or below the central parity rate each trading day, allowing for some flexibility in its value relative to the U.S. dollar. This daily fluctuation band helps manage the currency's exchange rate while maintaining a level of stability.
The central parity rate itself is calculated based on a weighted average of prices offered by market makers before the opening of the interbank market. This process occurs each business day and serves as the benchmark rate for the yuan against various foreign currencies, including the U.S. dollar.
The system ensures that the yuan’s value is adjusted according to market conditions while being closely monitored to prevent excessive volatility. It also plays a critical role in influencing the overall exchange rate dynamics between the yuan and other global currencies.
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