The Chinese authorities have stepped up reform of the exchange rate formation mechanism this week to make it more market-oriented, which is in line with the currency reform road map the country embarked on 10 years ago.

China lowered its daily midpoint reference of the yuan against the US dollar by 1.6 percent on Wednesday after lowering it by 1.86 percent the day before.

The International Monetary Fund sees the move as "a welcome step". But some analysts have interpreted it as a way for China to tackle its current economic downturn and, in particular, an effort to bail out its ailing export sector.