China's yuan closed stronger against the dollar on Monday as the central bank appeared to wind down intervention to stem its rise, traders said. The yuan closed at 6.2350 per dollar in early afternoon, 0.1 percent firmer than Friday's close of 6.2415. The central bank set its midpoint at 6.2892 per dollar, slightly firmer than Friday's fix after the dollar index fell in overnight trade.

Trading volume was moderate at over $9.7 billion, just below the market average, but sharply down from the unusually high $17 billion yuan traded on Friday, according to data from the People's Bank of China. Volumes recovered last week as major Chinese banks, suspected of acting at the behest of the central bank, sold yuan for dollars to restore liquidity to the market and weaken the yuan. The yuan looks set to end up around 1 percent against the dollar by the end of 2012.

Copyright Reuters, 2012