China’s central parity rate for the renminbi declined by 23 pips to 7.1405 per U.S. dollar on Monday, the China Foreign Exchange Trade System reported.

The central parity rate, a benchmark for daily trading, is a key measure of the yuan’s value.

In China’s spot foreign exchange market, the currency may move up to 2 per cent above or below this rate each day, ensuring a managed trading environment.

The rate is set using a weighted average of quotes from selected market makers before trading begins.

The yuan’s central parity rate adjustment reflects both domestic and global factors.

Analysts note that the U.S. dollar has recently stabilised after a prolonged decline, creating upward pressure on the greenback and prompting a corresponding softening of other major currencies, including the yuan.