China's yuan weakens in longest losing streak in 20 years

[SHANGHAI] China's yuan closed firmer against the dollar on Friday, but has slumped 0.4 per cent against the dollar this week, which would be a seventh straight weekly slide, the longest weekly losing streak since late 1995.

The People's Bank of China (PBOC) continued to set its daily yuan/dollar guidance rate at lows in 4-1/2 years, to 6.4814 per dollar prior to market open on Friday.

The spot market opened at 6.4870 per dollar and closed at 6.4815, 0.03 percent firmer than the previous close, but it lost 0.4 percent for the week and has shed a combined 2.6 per cent over the past seven weeks.

The yuan had eased over 10 straight days against the dollar through Thursday, the longest daily weakening streak on record.

The PBOC appears set to let the yuan depreciate to 6.5 per dollar before the year-end, traders said, but may not want it to fall too fast to spark any market panic.

The offshore yuan was trading 1.27 per cent weaker than the onshore spot at 6.565 per dollar, hitting the weakest level since Aug. 12, which was the second round of a hefty two-day devaluation of the currency that took place that month.

REUTERS