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Chinese yuan bank notes and coins as the currency weakened against the dollar after US Fed chair Janet Yellen said interest rate increases are likely later in the year. Photo: EPA

New | China’s yuan extend losses as dollar continues to climb

The Chinese yuan weakened for the second day as the US dollar continued to gain on Tuesday after US Federal Reserve chief Janet Yellen said the central bank is on track to raise interest rates amid a stronger-than-expected inflation figure.

The onshore yuan lost 0.04 per cent, or 23 basis points, to 6.2044, while the offshore yuan lost 0.02 per cent, or 13 basis points, to 6.2041.

The People’s Bank of China set the benchmark midpoint rate at 6.1173, weaker by 8 pips from a day earlier.

The US government will release its second estimate of first-quarter gross domestic product growth on Friday, the next key indicator which could help determine the timing of the rate hike.

Last month, the initial reading of the Q1 GDP growth showed a positive 0.2 per cent year-on-year.

Last week, the nation reported a stronger-than-expected inflation figure for April at 1.8 per cent, fanning hopes the rate increase will come this year.

The Hong Kong dollar was unchanged at 7.7522 against the greenback at noon.

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