⁍ Chinese banks have suspended the use of a tool used to influence the value of the yuan.

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⁍ The move analysts took to mean it is willing to allow some weakness in its currency.

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⁍ The offshore yuan slipped about 0.2% against the dollar to an almost two-week low of 6.7236 per dollar after Reuters reported the move.

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– China appears to be giving up on trying to keep the yuan strong. The country’s currency trading system said Tuesday that it has stopped using a tool that influences the value of the yuan used to determine the value of the dollar, Reuters reports. The People’s Bank of China, the country’s central bank, has been using the “counter-cyclical factor,” or X-factor, in its formula to determine the value of the yuan, but it will no longer use it. “Given that there is no longer any depreciation concerns, it makes sense to do away with the counter-cyclical factor, and reducing the reserve requirement ratio as they have done a couple of weeks back,” Khoon Goh, head of Asia research at ANZ, tells Reuters. “This does not necessarily mean that they are seeking to actively weaken the yuan—it is just that those tools are no longer needed.”