The Chinese currency has appreciated further. The dollar yuan rate has breached the 6.2 level -- both in spot trade and in the midpoint set by the central bank.
Wednesday's yuan dollar midpoint was 6.1980, 103 basis points higher than the previous fix. Spot yuan gained to around 6.1424, also a record high. The yuan has been gaining due to global monetary easing--which has attracted foreign currency inflows to China, forex regulators are cracking down on such hot money inflows.
Analysts believe that the fundamentals do not support the yuan's recent pace of appreciation, and that the yuan strength is more a reflection of bearish outlook on the dollar.
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