The People's Bank of China Friday set the mid-point rate for the yuan at the lowest level in eight-and-a-half years as heavy capital outflows and a hawkish Federal Reserve raise currency pressures in the world's second-largest economy that the government says are manageable.
The yuan's mid-point was set at 6.9508 per dollar Friday, the lowest since May 2008, compared with 6.9289 on Thursday. China's central bank lets the yuan spot rate rise or fall a maximum of 2 percent against the dollar relative to the official fixing rate.
Haibin Zhu, China chief economist for JP Morgan, said a rally in the dollar following a Fed rate hike this week and a hawkish forecast of three increases in 2017 was the key reason for the yuan's depreciation alongside other currencies.
Reference: CNBC
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