The yuan is likely to rise this week as the US dollar continues to weaken on worries of a possible US slump.

 

The yuan ended at 7.2485 on the China Foreign Exchange Trade system in Shanghai from 7.2620 a weak earlier.

 

Last week, Citigroup and Merrill Lynch reported huge losses in the fourth quarter of 2007 due to the subprime crisis.

 

Citigroup lost US$9.8 billion while Merrill Lynch suffered a US$9.83 billion loss in the fourth quarter.

 

The turmoil spread over into the US stock market, leading to concerns the US economy may fall into a recession.

 

A faster appreciation of the yuan is likely amid China's tight monetary policy to fight inflation.

 

(Shanghai Daily January 21, 2008)