The offshore yuan traded freely in Hong Kong rose the most in two weeks as stocks in China recorded the longest run of gains in almost two months and the nation pushed ahead with efforts to obtain reserve status for the currency.
The Shanghai Composite Index advanced for a fourth day, finishing above 4,000 for the first time since July 1. The People’s Bank of China has adopted stricter International Monetary Fund norms for its foreign-reserves and debt data and will work toward improving transparency, it said Friday. The yuan’s convertibility will be promoted “in an orderly way,” Deputy Governor Pan Gongsheng said Saturday. China has called for the IMF to add the yuan to its reserves basket.
The offshore yuan climbed 0.07 percent, the most since July 8, to 6.2098 a dollar as of 5:29 p.m. in Hong Kong, data compiled by Bloomberg show. The onshore currency, whose moves are restricted by a daily central bank fixing, was little changed at 6.2096 in Shanghai, according to China Foreign Exchange Trade System prices.
“The PBOC wants to keep the yuan stable as it promotes the currency’s global use and bolster its case to be named as a reserve currency,” said Kenix Lai, a foreign-exchange analyst at Bank of East Asia Ltd. in Hong Kong. “Depreciation isn’t wanted because that might reduce the yuan’s attractiveness.”
The onshore yuan’s discount to the PBOC’s daily fixing was 1.466 percent, the smallest since July 2 and within the 2 percent daily limit. The central bank set its reference rate at 6.1199, the lowest level since June 8.
— With assistance by Tian Chen