February 21, 2014 / 11:21 AM / in 4 years

Chinese offshore yuan slide extends past 6.10 per dollar

LONDON, Feb 21 (Reuters) - China’s yuan currency weakened to its lowest since early October in offshore trade on Friday, falling past 6.10 yuan per dollar and bringing its losses since Monday to more than 1 percent.

One of the safest bets for global investors in recent years has been the steady gains for the Chinese currency, long seen as undervalued, but indications of weaker growth in the world’s second biggest economy have underpinned a change in recent weeks.

The move on Friday was the biggest one day fall since October 2011, Reuters data showed.

“This is one of the most crowded positions in emerging markets, being long yuan versus the dollar,” said Manik Narain, an emerging market strategist at UBS in London.

“In the past few sessions the PBOC (China’s central bank) has been guiding the midpoint of the daily U.S. fix higher so there has been a bit of washout of positioning. It caught a lot of people off guard.”

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