SHANGHAI (Reuters) - China's yuan slipped on Friday, dampened by dollar strength and a sharply weaker daily fixing which was seen to be largely in line with market expectations for a weaker Chinese currency.
Spot yuan
The dollar index (DXY), which measures the value of the dollar against a basket of major currencies, gained 0.35 percent overnight, pushing the yuan sharply weaker in China's evening trade.
Before the market open, the People's Bank of China set the midpoint rate
The PBOC's guidance rate has increasingly lived up to investor expectations decided by dollar supply and demand in the domestic market after reforms adopted around last November when the International Monetary Fund announced it would admit the yuan into its Special Drawing Rights (SDR) basket, traders said.
"The yuan's move today reflected the dollar's global movements, while the PBOC largely stayed on the sidelines," said a trader at a Chinese commercial bank in Shanghai.
"Overall, the market is having an increasingly bigger role in pricing the yuan."
The offshore yuan was trading 0.39 percent weaker than the onshore spot at 6.5458 per dollar.
The onshore yuan weakened 0.2 percent against the euro (EURCNY=CFXS) by midday at 7.4164. It firmed 0.2 percent against the Japanese yen (JPYCNY=CFXS), hovering around 5.99 to 100 yen.