The yuan moved in a tight band between an intraday low of 8.2775 and a high of 8.2770. Turnover fell to a tiny US$120 million from Tuesday's $200 million.

"Most deals were seen at 8.2775," but trade was quiet as China was still getting back to work after the week-long lunar new year holidays, a Beijing-based domestic bank dealer said.

Dealers said the yuan was likely to hover at the firm end of its government-set trading box of between 8.2760 and 8.2800 in the near term, buoyed by China's healthy trade surplus.

The currency's movements within that trading box are decided basically by China's trade performance because the yuan is not fully convertible on the capital account.

Most Chinese trade firms are required to sell hard currency earnings to commercial banks designated to trade on the market.

Exports rose 22.3 percent year on year to US$325.57 billion in 2002, yielding a strong trade surplus of US$30.35 billion.

On Saturday, the Shanghai-based China Foreign Exchange Trade System extended trading hours from 9.30 am to 3.30 pm daily, without a midday break. Trading previously took place between 9.20 am and 11 am.

Dealers said the extension would help activate trade in the long term, although it had little immediate impact because of the holiday.

Central bank officials have said the yuan's range could be widened in the longer term to help counter any impact on trade and investment from China's accession to the World Trade Organization in late 2001. But they gave no timetable.

Yesterday, the yuan strengthened against the Japanese yen to 6.8417 versus 100 yen from 6.8574 on Wednesday. It eased to 8.9020 against the euro from 8.8946.

The yuan ended flat against the Hong Kong dollar at 1.0609.

(China Daily February 14, 2003)