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China's yuan falls to near one-year low as economy worries mount

Published on Mar 19, 2014 4:03 PM
 
China's yuan fell beyond 6.20 to the dollar on Wednesday, March 19, 2014, for the first time since April last year amid market speculation the central bank will keep the currency weak as economic growth slows down. -- FILE PHOTO: REUTERS

HONG KONG (Reuters) - China's yuan fell beyond 6.20 to the dollar on Wednesday for the first time since April last year amid market speculation the central bank will keep the currency weak as economic growth slows down.

The yuan has tumbled 0.8 per cent this week after the People's Bank of China (PBOC) doubled the daily trading band for the currency to 2 per cent from the mid-point set each day by the central bank.

Spot yuan briefly fell to 6.2009 per dollar by midday, down 0.14 per cent from Tuesday's close of 6.1920 and more than 1 per cent weaker than the mid-point set earlier of 6.1351.

"The yuan may not appreciate this year given China's weak economy," said a trader in Shanghai. "The return of yuan strength will not only rely on when the economy bottoms out, but when fresh long yuan funds come in."

 
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