[SHANGHAI] China's onshore yuan closed at its weakest against the dollar in more than 4 years on Tuesday, after the central bank set a softer midpoint and trade data showed the world's second-largest economy remained weak in November.
The onshore spot opened at 6.4130 per dollar and ended at 6.4172, 0.14 per cent weaker than Monday's finish and at its weakest closing level since August 2011.
Offshore yuan also weakened although it jumped suddenly in early afternoon trading, strengthening to 6.4750 per dollar, or 200 pips, in 30 minutes. It later eased and was trading at 6.4860 per dollar by the onshore market close - 1.06 per cent weaker than the onshore spot rate, the biggest spread between the two markets in the past three months.
Traders see onshore yuan possibly weakening to 6.45 per dollar in coming weeks if the central bank does not intervene to support the currency.
Prior to the start of trade, the People's Bank of China set the midpoint rate at 6.4078 per dollar, 0.15 per cent weaker than the previous fix of 6.3985.
China's trade performance remained weak in November, data showed on Tuesday, with exports falling for the fifth straight month and imports dropping for the 13th consecutive month, leading to a trade surplus of US$54.10 billion for the month.