Yuan firm

Shanghai

China´s yuan firmed against the U.S. dollar on Monday, buoyed by a stronger central bank guidance, but traders said further gains were likely to be restrained by corporate dollar demand this week.

Prior to market opening, the People´s Bank of China set the yuan midpoint at 6.7410 per dollar, the highest since Oct. 20 2016, reflecting the dollar´s broad weakness. Monday´s official guidance was 5 pips firmer than Friday´s fix at 6.7415 per dollar.

The spot market opened at 6.7610 per dollar and was changing hands at 6.7618 at midday, 43 pips firmer than the previous late session close but 0.31 percent weaker than the midpoint.

Traders said the market was quite stable with the onshore spot yuan moving within a range of around 60 pips, while trading volume shrank to $7.764 billion as of midday.