Yuan hits new high against US dollar

Currency records biggest gain of 0.1% in Shanghai since Feb '09

The yuan strengthened the most against the greenback yesterday on speculation that the government may allow more flexibility in the currency exchange rate, even as analysts cautioned on risks from increased "hot money" flows.

The yuan gained 0.1 percent to 6.8264 per dollar in Shanghai, the biggest gain since February 2009, according to the China Foreign Exchange Trade System. That's the third fluctuation of 0.05 percent or more in four trading days. Local financial markets were closed last week for the Lunar New Year holiday.