China's yuan closed up against the dollar on Friday after the central bank set a slightly stronger midpoint, a move that traders said signalled authorities intend to allow the yuan to end up by about 1 percent for the year. China has long been under pressure from the United States to let the yuan appreciate to balance bilateral trade.

In past years, the central bank has typically let the currency rise slightly in the final days of December to increase the percentage by which it strengthened for the year. The yuan finished at 6.2335 per dollar, up from Thursday's close of 6.2360, up 0.97 percent year-to-date. Volume jumped to a heavy $19.13 billion from Thursday's $13.93 billion. The People's Bank of China (PBOC) strengthened its midpoint to 6.2896 from Thursday's 6.2949. The exchange rate is allowed to diverge by only 1 percent in either direction from the central bank's daily midpoint.

Copyright Reuters, 2012