Yuan depreciation fears surface again

Despite policymakers taking monetary easing measures to tackle currency fluctuations, expectations of a further yuan depreciation persist ahead of possible increase in interest rates by the United States Federal Reserve.

On Wednesday, the yuan's reference rate declined to a four-year low of 6.4043 per dollar, 0.09 percent weaker than the levels on Tuesday. Offshore yuan in Hong Kong was trading at 6.4930 per dollar, or 1.14 percent lower than the onshore spot price.

Close on the heels of the currency depreciation was the combined 25-basis-point cuts in the benchmark interest rates and a 50-basis-point reduction of the reserve requirement ratio - the amount of cash that must be held by financial institutions as reserves, announced by the People's Bank of China on Tuesday.