The value of the Chinese currency yuan against the U.S. dollar hit a new high on Tuesday with a central parity rate of 7.7595 yuan to the dollar, according to the Chinese Foreign Exchange Trade System.

The yuan, also known as RMB, gained 45 basic points from Monday's reference rate of 7.7640 to the U.S. dollar, strengthening further from last record of 7.7613 on Friday.

The record is the 11th one the RMB has set since the beginning of the new year.

The yuan has appreciated around five percent since China scrapped the peg of 8.27 yuan to one U.S. dollar in July 2005 and allowed the yuan to float against the dollar within a daily 0.3 percent band from the official central parity rate.

Analysts said the further appreciation would help China to slow the expansion of its trade surplus and foreign exchange reserves, allaying the allegations from the U.S. government that the yuan was undervalued to give China's exports a price advantage.

China registered a record trade surplus of 177.47 billion U.S. dollars in 2006 and forex reserves of over one trillion U.S. dollars by the end of last year.

RMB has appreciated over 0.6 percent since the beginning of this year, according to the China Economic Times, citing Lin Yifu, a renowned economist from Peking University's China Center for Economic Research.

He warned that too rapid appreciation would give a boost to the inflow of more hot money and may eventually hurt the economy.

World's leading investment bank Goldman Sachs has predicted that RMB would appreciate another 5.7 percent in 2007.

Source: Xinhua