Yuan strengthens after Armenia currency swap deal

The central parity rate of the Chinese yuan strengthened by 35 basis points to 6.1375 against the U.S. dollar on Thursday, according to the China Foreign Exchange Trading System.x The surge came after a currency swap deal between China and Armenia valued at 1 billion yuan (162.93 million U.S. dollars), or 77 billion Armenian dram.

The three-year deal signed by China's central bank and its Armenian counterpart aims to boost bilateral trade and investment, and it could be extended upon agreement by both sides, said the People's Bank of China late on Wednesday.

To encourage international use of the yuan, China has signed currency swap agreements with more than 20 countries and regions since the onset of the global financial crisis in late 2008.

In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.

The central parity rate of the yuan against the U.S. dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.