THE yuan extended its gains to 20 percent since China ended a fixed exchange rate to the US dollar in July 2005, as top officials from the two countries are holding a new round of economic dialogue in the United States.
The currency climbed for a fifth day, reaching 6.8909 per US dollar. The yuan's rise since the peg was scrapped compares with a 29-percent gain for the euro against the US dollar, 13.2 percent for the British pound and 4.7 percent for the yen.
China has allowed a faster gain this year to curb import costs and slow inflation.
The talks in Annapolis, Maryland yesterday and today will be on energy and the environment rather than the yuan, Bloomberg News said.
"Yuan appreciation is the only viable choice for containing accelerated inflation," said Claudio Piron, a currency strategist with JPMorgan Chase & Co in Singapore. "China is getting a break from foreign pressure."
The yuan gained 0.13 percent to 6.8915 per US dollar in Shanghai yesterday, from 6.9004 on Monday, according to the China Foreign Exchange Trade System. It has risen 1.7 percent this quarter versus a 4.2-percent gain in the previous three months.
The yuan may rise to 6.5 by the end of 2008 and add 20 percent by the end of 2012, according to Piron.