The Chinese yuan advanced today as China’s President Hu Jintao assured US President Barack Obama that the country will allow a more flexible exchange rate and after the nation’s central bank set the record reference rate.

The People’s Bank of China set the fixing at 6.2840 yuans per dollar today. That’s the highest level since the end of the dollar-peg in 2005. The yuan is allowed to trade at the range of 0.5 percent on either side of the fixing. Hu told Obama in a meeting in Seoul yesterday that China is going to ”let the market play a greater role” and increase flexibility of the currency.

USD/CNY dropped from 6.3160 to 6.3080 as of 10:57 GMT today after it climbed as high as 6.3331.

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