Chinese yuan advances to 6.3267 against USD Monday

The Chinese yuan strengthened to the strongest level since Nov. 2, 2015 on Monday following prolonged weakness of the U.S. dollar.

[Photo: VCG]

The central parity rate of the Chinese currency renminbi, or the yuan, strengthened 169 basis points to 6.3267 against the U.S. dollar Monday, the seventh consecutive rise, according to the China Foreign Exchange Trade System.

Huang Zhilong, a researcher with the financial research arm of the Suning Group, attributed yuan's strong reading to persistent weakening of the U.S. dollar.

The dollar index, a gauge that measures the U.S. currency's strength against six other major currencies, have declined over 3 percent since the beginning of this year.

The yuan has also gained nearly 3 percent against the U.S. dollar since earlier this year, tracking the dollar weakness by the same margin.

A strong yuan is also backed up by solid fundamentals of the Chinese economy and improvements of the company profits, he said.

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.