* PBOC fixes mid-point at record high of 6.3425
* U.S. congressional hearing adds appreciation pressures
* Market players expect yuan may hover around strong levels
* Yuan at 6.3604, up 3.61 percent so far this year
By Chen Yixin and Jacqueline Wong
SHANGHAI, Oct 25 (Reuters) - The yuan ended up versus the dollar on Tuesday after the People’s Bank of China set a record high mid-point ahead of a U.S congressional hearing on Chinese trade practices.
A senior Republican lawmaker announced last week the hearing on trade practices he said were hurting American businesses and workers, but stopped short of promising action on Senate currency legislation to deal with the concerns.
“The government will inevitably be wary of this,” said a trader at a Chinese commercial bank in Shanghai. “We expect the central bank could still let the fixing hover around a high level before the U.S. makes a decision.”
U.S. lawmakers critical of China’s trade policies will use the hearing on Tuesday to press the White House to lay out a strategy to confront Beijing, even as Republicans resist a bill to punish the world’s second largest economy for its currency practices. The hearing comes two weeks after the Senate passed legislation to push China to let the yuan rise in value.
But spot yuan failed to hit a record high on Tuesday as investors still believe that China has no intention of pushing up the Chinese currency without international pressure as domestic economic growth slows.
Spot yuan closed at 6.3604 versus the dollar, up from Monday’s close of 6.3754. It has risen 3.61 percent so far this year and 7.32 percent since it was depegged from the dollar in June 2010.
Before trading began, the PBOC set the mid-point of the day at 6.3425, stronger than Monday’s 6.3549. The central bank uses the fixing to signal the government’s intentions for the yuan.
China had let the yuan rise as much as 4 percent versus the dollar from the beginning of this year to Tuesday Oct. 11 -- just ahead of the U.S. Senate’s approval of its yuan bill.
Offshore, one-year dollar/yuan non-deliverable forwards (NDFs) were bid at 6.3865 in late trade compared with 6.4000 at the close on Monday.
They implied yuan depreciation of 0.69 percent in 12 months from Tuesday’s PBOC mid-point, compared with depreciation of 0.90 percent they implied on Monday.