Traders are allowed to trade up to 2 per cent either side of the reference point for the day.
Stephen Innes, senior trader at OANDA, told the Post he now expected the yuan to trade at 7 to the dollar by the end of the year.
“I’m not going to get excited until it hits 7,” he said.
He said the yuan was falling on the US dollar’s continual rise, although mainland China often had a “psychological issue” with the connection between the currencies, and he didn’t see the US dollar’s momentum abating.
There had been heavy capital outflows due to the low yuan, and Innes warned: “If we don’t temper this exodus in some respect, I think it would be a free-for-all as we get into year-end.”
On Wednesday, the US dollar rose to its highest level since March 2003, pushed up by positive US economic reports that reinforce expectations of interest rate hikes next month.
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