China's Yuan reached a record high against the U.S. dollar Thursday afternoon as the dollar-Yuan central parity rate slumped to its lowest level, taking inspiration from the declining fortunes of dollar in Asian markets.
As per the over-the-counter market rate, the dollar was trading at CNY6.6529 around 0730 GMT, down from Wednesday's CNY6.6641. It traded between CNY6.6504, which is its lowest intraday level since the Yuan was listed on regular trading index in 1994, and CNY6.6590.
The 6.6504 to a dollar rate represents a 2.6% surge since June 19, when the People's Bank of China pledged increased trading flexibility in Yuan and removed the currency's attachment to the dollar.
The PBOC set Wednesday's dollar-Yuan central parity rates to 6.6582, which is lower than the previous record of 6.6693, thus setting a new record and showing decreased interest in the greenback.
The dollar also dropped against a basket of major currencies as there are reports of monetary easing and low interest rates to be announced by the U.S. Federal Reserve. The Monetary Authority of Singapore has increased its control over the monetary policy and this has had serious impacts on the U.S. dollar.
The ICE Dollar Index was trending at 76.439 around 0730 GMT, a decline from 77.060 recorded late Wednesday in New York and 77.339 late Tuesday in New York. The index is computed after tracking the U.S. dollar against a trade-weighted basket of currencies.
In offshore trading, one-year dollar-Yuan non-deliverable forwards dropped to 6.4260/6.4300, a further decline from 6.4580/6.4630 recorded late Wednesday.
