Despite a slight adjustment on Tuesday, foreign exchange dealers expect the yuan to continue rising against the US dollar after hitting a new high on Monday because of a large inflow of capital and pressure from the US.

Spot yuan was trading at 6.1222 against the dollar at midday on Tuesday, down slightly from 6.1211 at the close on Monday, falling back from a high of 6.1210, a record since China established the domestic foreign exchange market in 1994.

The People's Bank of China, the central bank, set the yuan central parity rate against the dollar at 6.1811 on Monday, 56 basis points higher than the previous trading day.