In the spot market, the onshore yuan opened at 6.8800 per dollar and was changing hands at 6.8784 at midday, 83 pips weaker than the previous late session close.
The onshore spot yuan swung in an extremely tight range of less than 50 pips in morning deals, while trading volume contracted to $6.2 billion at midday, little more than a third of normal half-day volume of about $15 billion. "The market has no clear direction, investors may monitor U.S. data first," said a trader at a foreign bank. The closely watched U.S. non-farm payrolls, due later in the day, may offer more clues on the U.S. monetary tightening trajectory, which could affect the dollar and other major currencies including the yuan. Traders said they will also monitor China's credit lending and trade data, due next week, to gauge the pace of domestic economic recovery. "While there is room for the economy to surprise positively this year, Beijing's putatively modest growth target of 5% suggests that the authorities are not chasing growth at all costs," said Alvin Tan, head of Asia FX at RBC Capital Markets. "The current account surplus is also likely to narrow amid higher consumption and the resumption of outbound travel."
By midday, the global dollar index rose to 101.91 from the previous close of 101.822, while the offshore yuan was trading at 6.8821 per dollar.
The one-year forward value for the offshore yuan traded at 6.734 per dollar, implying a 2.20% appreciation within 12 months.
The yuan market at 0326 GMT:
ONSHORE SPOT:
Item Current Previous Change
PBOC midpoint 6.8838 6.8747 -0.13% Spot yuan 6.8784 6.8701 -0.12% Divergence from -0.08%
midpoint*
Spot change YTD 0.31%
Spot change since 2005 20.33%
revaluation
Key indexes:
Item Current Previous Change
Dollar index 101.91 101.822 0.1
*Divergence of the dollar/yuan exchange rate. Negative number
indicates that spot yuan is trading stronger than the midpoint.
The People's Bank of China (PBOC) allows the exchange rate to
rise or fall 2% from official midpoint rate it sets each
morning.
OFFSHORE CNH MARKET
Instrument Current Difference
from onshore
Offshore spot yuan 6.8821 -0.05%
*
Offshore 6.7262 2.34%
non-deliverable
forwards
**
*Premium for offshore spot over onshore
**Figure reflects difference from PBOC's official midpoint,
since non-deliverable forwards are settled against the midpoint. .
(Reporting by Winni Zhou and Tom Westbrook; Editing by Kenneth
Maxwell)
