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Economy

China sets yuan midpoint firmer than key 7 per dollar for first time in 3 months

SHANGHAI (Reuters) -- China's central bank lifted on Friday its official yuan midpoint to the highest level in over three months, breaching a key threshold, to reflect market optimism after Beijing and Washington agreed to roll back tariffs on each other's goods if they reach a preliminary trade deal.

The People's Bank of China (PBOC) set the midpoint rate at 6.9945 per dollar prior to the market open, 63 pips or 0.1% firmer than the previous fix of 7.0008 and the strongest since Aug. 6.

It's also the first time in three months that the central bank set its official guidance rate firmer than the key 7 per dollar level.

The PBOC allowed the spot yuan to fall below the key mark in early August for the first time since the global financial crisis.

China and the United States must simultaneously cancel some existing tariffs on each other's goods for both sides to reach a "phase one" trade deal, the Chinese commerce ministry said on Thursday. 

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