China's yuan breaks 7.25 mark against US dollar
Updated: 2008-01-15 10:44
China's currency, the yuan, hit a new high against the US dollar on Tuesday, breaking the 7.25 mark to reach a central parity rate of 7.2454 yuan to one dollar.
The yuan, also known as the Renminbi, went up 112 basis points from Monday.
The local currency smashed psychological barriers for three trading days in a row. This was the sixth time that the yuan hit a new high against the US dollar since the beginning of this year.
Analysts said mounting expectations for interest rate cut by the Federal Reserve of the United States helped push down the US dollar continuously. On Monday, the greenback went down on global forex markets in response to the news about Citibank writing off 24 billion dollars of assets.
The yuan rose 6.9 percent against the dollar last year and has appreciated against the greenback by more than 12 percent since a new currency regime was imposed in July 2005 to discontinue the local currency's peg to the dollar.
The analysts forecast that the Chinese currency would appreciate at least 7-10 percent against the US dollar for the whole of this year.
On Tuesday, the Renminbi lost 305 basis points against the unified European currency to 10.7757 yuan to one euro, and 414 basis points against the Japanese currency to 6.7059 yuan to 100 Japanese yen. But it gained 568 basis points to reach 14.1582 yuan to one British pound.