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China's yuan edges up in line with midpoint, US dollar moves

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China's yuan firmed slightly on Wednesday, with the Chinese currency fluctuating in line with the central bank's midpoint and the US dollar's movements in global markets.

[SHANGHAI] China's yuan firmed slightly on Wednesday, with the Chinese currency fluctuating in line with the central bank's midpoint and the US dollar's movements in global markets.

"The market is quiet," said a trader at an European bank in Shanghai, noting a lack of market cues.

"Expecting no major market-moving news around the corner, it moves in line with the midpoint and inverse to the dollar's global performance," the trader said.

The spot market opened at 6.5148 per US dollar and was changing hands at 6.5128 at midday, 0.09 per cent stronger than the previous close.

Prior to market open, the People's Bank of China (PBOC) set the midpoint rate at 6.5209 per US dollar, 0.04 per cent firmer than the previous fix 6.5233, reflecting a slight weakening in the US dollar index in early Asian trade.

Traders said the PBOC had recently set its official guidance rate more in line with movements in the dollar index, another reason for the market to focus on the greenback.

The offshore yuan was trading 0.37 per cent weaker than the onshore spot at 6.5368 per US dollar by midday.

The onshore yuan weakened 0.2 per cent against the euro by midday at 7.4151. It firmed 0.1 per cent against the Japanese yen, hovering around 5.98 to 100 yen.

REUTERS