Parity rate climbs

The central parity rate for the yuan against the US dollar rose to 6.8203 yesterday, the largest daily rise in seven weeks.

The daily mid-point, set by the central bank before trading, climbed 0.37 percent from Friday's 6.8458. But the yuan then weakened to 6.857 a dollar at 5:30 pm in Beijing yesterday, according to China's Foreign Exchange Trade System.

"The higher mid-point, which in theory contradicts the interest rate cut, implies the central bank wants to stabilize the yuan's exchange rate," Liu Dongyuan, a Shenzhen-based foreign exchange analyst with China Merchants Bank, said. "A drastic depreciation may lead to a capital outflow."