Business / Markets

Yuan to see normal fluctuations in 2015

(Xinhua) Updated: 2014-12-26 17:06

BEIJING -- The renminbi will experience "normal fluctuations" in 2015, experts said on Thursday.

The yuan will continue to experience depreciation and appreciation next year, said chief economist with the Bank of Communications Lian Ping.

The central parity rates of the yuan will see less violent changes in 2015 and its spot exchange rates will fluctuate between 6 and 6.4 against the US dollar, as in 2014, Lian said.

The market is expecting the United States will raise interest rates amid its economic recovery and the US dollars will strengthen, thus, the yuan will face downward pressure, but it will not depreciate remarkably, said chief analyst of the Beijing-based CFFEX Institute for Financial Derivatives Zhao Qingming.

This view was echoed by chief economist of the Industrial Bank Lu Zhengwei, who believes that China's economic growth, trade and foreign exchange reserves are positive signs that the yuan will remain stable.

The spot exchange rate of China's currency dropped below 6.21 against the US dollar last Thursday, the weakest point in almost five months.

The central parity rate of the yuan climbed 34 basis points to 6.1213 against the US dollar on Thursday, after five-consecutive day drops.

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 US dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day.

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