China Yuan Extends Gains for Second Day on 2014 GDP Data

 
                                  Vs Parity  Previous 
USD/CNY Central Parity   6.1268               6.1226 
USD/CNY OTC 0830 GMT     6.2115    +1.38%     6.2142 
            High         6.2199    +1.52% 
            Low          6.2105    +1.37% 
 

        SHANGHAI--China's yuan rose against the U.S. dollar Wednesday after the country's stronger-than-expected economic growth boosted investor confidence in the currency.
        The yuan extended Tuesday's gains despite the central bank's efforts to guide it lower via a daily reference rate.
        The yuan closed at 6.2115 to a dollar Wednesday, compared with 6.2142 at Tuesday's close. The currency traded between 6.2105 and 6.2199 in the session.
        China's economy grew 7.4% in 2014, data showed Tuesday, slightly better than a 7.3% growth forecast from a Wall Street Journal poll. Traders said the ups and downs in the yuan market are mild so far this year, as investors are waiting for central bank direction.
        "I don't want to build a big position on either side now, as the central bank hasn't pointed out where it wants the currency to go," a Shanghai-based foreign bank trader said, adding that the central bank was unlikely to make policy changes in the period leading up to Chinese New Year in late February.
        The People's Bank of China set the dollar/yuan central parity rate at 6.1268, higher than Tuesday's 6.1226, following dollar strength overseas.
        The yuan has fallen 0.1% against the dollar since the start of 2015. The currency fell 2.5% against the dollar last year, thanks to slowing domestic growth and strength in the U.S. economy which sent its dollar higher. It was the first time the Chinese currency recorded an annual loss since 2010.
        Offshore, one-year dollar/yuan nondeliverable forward contracts fell to 6.3145 from 6.3175 late Tuesday, implying a 1.6% 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 CNY6.2147, lower than CNY6.2192 late Tuesday.
        Write to Wynne Wang at wynne.wang@dowjones.com
        (END) Dow Jones Newswires

        January 21, 2015 04:00 ET (09:00 GMT)

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