New | Chinese yuan weakens as PBOC sets mid-price at a lower level, sterling climbs

The Chinese yuan weakened on Friday against the US dollar after release of poor Chinese trade figures, while the country’s central bank also set the mid-price at a lower level.

The British pound rose strongly against all major currencies on Friday morning on expectations the Conservative Party in Britain will stay in office.

“The yuan is trading in a narrow range but the direction is weakening against the US dollar as the market believes the currency would be unlikely to strengthen too much in the near term,” said Andrew Fung, executive director of Hang Seng Bank.

“The pound bounced back substantially as the market believes the Conservative Party policy is good for the currency and the financial markets. This however may last for a short term. Its long term trend would depend on future economic data,” he said.

The onshore yuan traded at 6.2083 to the dollar at 10:30 am, down from the 6.2069 close on Wednesday and is close to its one-month low at 6.2098.

The weak yuan trading on Friday came just as China reported April trade data that was poorer than expected with exports went down by 6.4 per cent while imports sank 16.2 per cent, with both sets of figures well below market expectations.