Yuan strengthens

China´s yuan edged up against the dollar on Monday, reflecting a firmer midpoint in cautious trading as investors looked to the Federal Reserve policy meeting clues on the pace of U.S. monetary tightening next year.

The Fed is widely expected to raise interest rates at the end of a two-day policy meeting on Wednesday, and is seen as likely to hike a further two to three times in 2018. Prior to market opening on Monday, the People´s Bank of China set the midpoint rate at 6.6152 per dollar, snapping 10 straight days of weaker settings, 66 pips or 0.1 percent firmer than Friday´s fix of 6.6218. In the spot market, the onshore yuan opened at 6.6190 per dollar and was changing hands at 6.6160 at midday, 80 pips firmer than the previous late session close.

Traders said the yuan was hemmed in a tight range on Monday morning, with the spot rate swinging around the official midpoint.