BEIJING - China Foreign Exchange Trade System (CFETS) on Friday released a yuanexchange rate composite index that measures the currency's strength relative to a basket ofother currencies to better reflect the market.The index is calculated by comparing yuan to the average value of the 13 foreign currencies,including the US dollar, Euro and Japanese yen, weighted according to the trade volume withChina, according to the CFETS.
On November 30, the index stood at 102.93, which means that yuan has appreciated 2.93percent compared to the level at the end of 2014, the CFETS said.
"The data shows that although yuan has weakened against the US dollar in 2015...it remainsstrong among major global currencies," said a commentary published on the CFETS website.
The move is part of efforts to offer a more comprehensive reflection of market changes.Previously, market watchers have mainly fixated on the yuan-US dollar rate.
The CFETS index will help the market to change the usual practice and gradually use thecomposite index as a reference, which is conducive to keeping the rate stable at a reasonablelevel, the commentary reads.
Friday's move came as the Chinese currency has weakened against the US dollar for severaldays. The central parity rate of yuan weakened by 122 basis points to 6.4358 against the USdollar on Friday, the lowest level in over four years.
In a reassuring message to the market, Wang Chunying, an official of the State Administrationof Foreign Exchange told a press conference on Thursday that current fluctuations of theexchange rate should not be seen as a sign of devaluation.
Wang said more consideration should be taken of the RMB multilateral exchange rate againsta basket of currencies and its long-term trend.
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