China's yuan currency surged more than one percent against the dollar on Monday, its biggest rise in over a decade, after the central bank chief said there was no reason the beleaguered unit should fall further.The yuan stood at 6.4944 to $1.0 at 0830 GMT, up 1.14 percent from February 5 -- the last trading day before a week-long holiday -- according to the national foreign exchange market.
The Chinese economy grew 6.9 percent in 2015, the slowest rate since 1990. Capital has been flowing out of the country on worries about the flagging growth, causing the currency to weaken -- which in turn drives withdrawals.
The central bank signalled a preference for a stronger currency on Monday by fixing its value higher by the biggest margin for more than three months.China is seeking a greater role in global commerce for the yuan, but limits the currency to rising or falling two percent on either side of the daily fix.
The PBoC set the yuan at 6.5118 to $1.0 on Monday, strengthening 0.30 percent from the fix on February 5, according to data from the China Foreign Exchange Trade System.
UBS forecast the yuan would weaken to 6.8 to $1.0 by the end of the year but the movement would be gradual."The probability of China holding (US dollar/Chinese yuan) stable in the next few months is greater than a significant depreciation or a one-off adjustment," it said.
The Chinese economy grew 6.9 percent in 2015, the slowest rate since 1990. Capital has been flowing out of the country on worries about the flagging growth, causing the currency to weaken -- which in turn drives withdrawals.
The central bank signalled a preference for a stronger currency on Monday by fixing its value higher by the biggest margin for more than three months.China is seeking a greater role in global commerce for the yuan, but limits the currency to rising or falling two percent on either side of the daily fix.
The PBoC set the yuan at 6.5118 to $1.0 on Monday, strengthening 0.30 percent from the fix on February 5, according to data from the China Foreign Exchange Trade System.
UBS forecast the yuan would weaken to 6.8 to $1.0 by the end of the year but the movement would be gradual."The probability of China holding (US dollar/Chinese yuan) stable in the next few months is greater than a significant depreciation or a one-off adjustment," it said.
