SHANGHAI, July 12: China’s yuan fell against the dollar on Friday as sentiment weakened after the country’s finance minister said that the pace of growth this year could be slower than the government’s target.
Lou Jiwei said that he expects growth to come in at 7 percent this year, the official Xinhua news agency quoted him as saying in Washington on Thursday, below the official target of 7.5 percent.
Spot yuan was trading at 6.1402 against the dollar at midday, down 0.08 percent from Thursday’s close of 6.1352 after the People’s Bank of China (PBOC) set the midpoint at 6.1631, 0.05 percent weaker than Thursday’s.
Spot yuan is now trading 0.37 percent stronger than the fix, the narrowest the spread has been since Sept. 18 last year.
Traders also reported that corporates have become more willing to retain dollars on hand, implying they increasingly expect the yuan to weaken further going forward.
China posted an unexpected slump in exports in June, raising the prospect that regulators may be forced to drag the yuan back down after a rally this year.
(agencies)
Trending Now
E-Paper
Follow our WhatsApp channel