China Yuan Down on Rising Dollar Demand

 
                                  Vs Parity  Previous 
USD/CNY Central Parity   6.1152               6.1184 
USD/CNY OTC 0830 GMT     6.1912    +1.24%     6.1869 
            High         6.1946    +1.30% 
            Low          6.1819    +1.09% 
 

        SHANGHAI--China's yuan weakened slightly against the U.S. dollar Monday as demand for the U.S. dollar rose from oil companies and foreign enterprises, despite the central bank's efforts to guide the currency stronger via a daily reference rate.
        The yuan closed at 6.1912 to a dollar, compared with 6.1869 at Friday's close. The currency traded between 6.1819 and 6.1946 in the session.
        The People's Bank of China set the dollar/yuan central parity rate at 6.1152, lower than Friday's 6.1184, following the dollar's weakness overseas.
        "The oil companies need the dollar to purchase crude when oil prices are falling and the foreign companies need the greenback to remit their profits back to their parent companies," said a Shanghai-based foreign bank trader.
        But traders said the yuan has strong support at the 6.2000 psychological level.
        The yuan has fallen 2.2% since the start of 2014.
        Offshore, one-year dollar/yuan nondeliverable forward contracts fell to 6.3065/6.3095 from 6.3115/6.3130 late Friday, implying a 1.8% fall by the yuan over the next year.
        In the offshore yuan market in Hong Kong, where the Chinese currency floats freely, the dollar was at CNY6.1931, higher than CNY6.1887 late Friday.
        Write to Wynne Wang at wynne.wang@dowjones.com
        (END) Dow Jones Newswires

        December 15, 2014 03:56 ET (08:56 GMT)

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