By Judy Chen
Jan. 14 (Bloomberg) -- China’s yuan was little changed against the dollar on speculation a slide in exports prompted the central bank to halt the currency’s appreciation.
The People’s Bank of China fixed the yuan’s reference rate at the weakest level in almost a month after a government report yesterday showed overseas sales fell the most in almost a decade in December. The Chinese currency has dropped 0.2 percent so far in 2009 after rising 0.37 percent in the final quarter of last year and 0.17 percent in December.
“The trade data indicates signs of more declines in exports,” said Yang Shengkun, a currency analyst in Beijing at China Citic Bank Co., a unit of China’s biggest state investment company. “The trade surplus will probably narrow further, providing less support for yuan appreciation.”
The yuan traded at 6.8366 a dollar as of 10:17 a.m. in Shanghai, from 6.8341 yesterday, according to the China Foreign Exchange Trade System.
China’s exports dropped 2.8 percent, the customs bureau said on its Web site yesterday. That compares with a 21.7 percent gain a year earlier. Shipments grew 17.2 percent for all of 2008, down from 25.7 percent in 2007.
China’s trade surplus narrowed to $38.98 billion last month, from $40.09 billion in November. That was the first decline in 10 months.
The yuan’s central parity rate was set at 6.8399 per dollar today, the lowest since Dec. 16.
To contact the reporters on this story: Judy Chen in Shanghai at xchen45@bloomberg.net
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