China sets yuan midpoint at near 2-year low to reflect broad dollar strength

China set its yuan midpoint at a near two-year low against the dollar on Friday to reflect broad greenback strength in global markets after Federal Reserve officials indicated more interest rate hikes were needed.

The People's Bank of China set the midpoint rate at 6.8065 per dollar prior to market open, 263 pips or 0.39% weaker than the previous fix 6.7802, the weakest since Sept. 30, 2020.

The U.S. dollar index surged to a one-month high as Fed officials spoke of the need for further rate hikes, and investors reevaluated minutes from the U.S. central bank's July meeting as being more hawkish than originally thought.

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