Yuan hits fresh 5½-year low, PBoC on sidelines

Rate policy: A woman walks past the headquarters of the PBoC in Beijing. The central bank has pledged to let the market have a bigger say in the exchange rate, but has also stressed it wants to keep the currency relatively stable. — Reuters

SHANGHAI: The yuan closed weaker against the US dollar, touching a fresh 5½-year low on concerns that the central bank would tolerate a further weakening of the currency to support the slowing economy.

Reuters reported on Thursday that the People’s Bank of China (PBoC) would tolerate a fall in the yuan to as low as 6.8 per dollar in 2016, which would mean the currency matches last year’s record decline of 4.5%, policy sources said.