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(Yicai Global) Aug. 9 -- The yuan's central parity rate against the US dollar hit a 10-month closing high of 6.7075 today, appreciating 109 basis points from yesterday.
In the overnight market, the dollar fluctuated smoothly. Yesterday, as the dollar remained in a tight range, the yuan's price briefly rose as high as 6.70.
The dollar price did not change much yesterday, and the yuan's appreciation was an independent market fluctuation, said Li Liuyang, a foreign currency analyst
When the market gradually created a new high, the settlement demand of cross trade was stimulated, Li said.
Two things may have caused the shift, said Han Huishi, another foreign currency analyst. One is that a high volume of forex settlements occurred, and the other is the dollar bulls' pull in the market shrank substantially.
The situation reflects that the expectation of yuan depreciation has apparently cooled due to the market's expectancy that the dollar will remain weak and rising confidence about the appreciation of the yuan that started at the beginning of the year.