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Yuan eases, set for biggest weekly fall in seven weeks

    SHANGHAI, Nov 13 (Reuters) - The yuan eased against a rising
dollar on Friday, as sentiment was hammered by a rise in U.S.
coronavirus infections, prompting investor worries that the
pandemic might create wider disruption to the global economy.
    Risk-off sentiment in global markets increased safe-haven
demand for the greenback and yen after surging daily infections
and rising hospitalisations in several U.S. cities, forcing
governments to re-impose public health restrictions.

    Prior to market opening, the People's Bank of China (PBOC)
set the midpoint rate at a one-week low of 6.6285 per
dollar, 49 pips weaker than the previous fix of 6.6236. 
    In the spot market, onshore yuan opened at 6.6196
per dollar and was changing hands at 6.6264 at midday, 149 pips
weaker than the previous late session close.
    If the yuan finishes the late night session at the midday
level, it would have lost 0.28% against the dollar for the week,
marking the worst weekly performance in seven.
    "The market is tracking the dollar's movements," said a
trader at a Chinese bank.
    "Investors await more details about the vaccine breakthrough
and U.S. President-elect Joe Biden's China policy agenda."
    Several currency traders said they were watching the
development of a possible COVID-19 vaccine, which could shrink
the gap in the pace of economic recovery between China and the
rest of the world, which would add pressure to the yuan.
    However, other analysts remain bullish on the yuan and have
revised up their forecasts for the Chinese unit.
    "Biden's win reduces the CNY's event risk premia, which
should allow the currency's value to better reflect its
fundamentals," Becky Liu, head of China macro strategy at
Standard Chartered, said in a note.
    "We now expect the CNY to strengthen into H1-2021, before
potentially giving back some gains in H2-2021 as China's
relative economic strength narrows."  
    Liu revised her forecast for the yuan up to 6.55 at
end-2020, 6.30 at end H1-2021, and 6.45 at end-2021. 
    The global dollar index rose to 92.995 at midday,
when the offshore yuan was trading at 6.6265 per
    The yuan market at 0400 GMT: 
 Item               Current  Previous  Change
 PBOC midpoint      6.6285   6.6236    -0.07%
 Spot yuan          6.6264   6.6115    -0.22%
 Divergence from    -0.03%             
 Spot change YTD                       5.08%
 Spot change since 2005                24.90%
    Key indexes:
 Item            Current     Previous  Change
 Thomson         95.52       95.4      0.1
 CNH index                             
 Dollar index    92.995      92.968    0.0
*Divergence of the dollar/yuan exchange rate. Negative number
indicates that spot yuan is trading stronger than the midpoint.
The People's Bank of China (PBOC) allows the exchange rate to
rise or fall 2% from official midpoint rate it sets each

 Instrument            Current   Difference
                                 from onshore
 Offshore spot yuan    6.6265    0.00%
 Offshore              6.8065    -2.62%
*Premium for offshore spot over onshore
**Figure reflects difference from PBOC's official midpoint,
since non-deliverable forwards are settled against the midpoint.

 (Reporting by Winni Zhou and Andrew Galbraith; Editing by Sam