The Chinese yuan rose above the 6.5 level against the US dollar today for several hours before returning to the levels below this important psychological rate.The yuan reference trading rate was moved up to 6.499 per USD by the People’s Bank of China today. The currency is allowed to appreciate or depreciate within 0.5 percent boundary during a daily trading session, allowing an intraday low on the USD/CNY currency pair of 6.4805.
The main reason for this long-awaited (at least in the United States) strengthening of the yuan is seen in the rising inflation of the consumer prices in China. Another positive factor for this regulated currency is the prolonged weakness of the US dollar, which continued to fall against other major currencies this week.
USD/CNY rose from 6.5027 to 6.5060 as of 12:39 GMT today, following a drawdown to 6.4805 between 6:00 and 8:00 GMT.
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