The authorities in China have announced its decision to double yuan's daily trading band as part of its plans to encourage greater usage of the currency.

The move will allow more independence to the national currency giving more power to the market forces in determine the value of the Chinese currency. The Chinese government is facing pressure from tis trading partners including the US, for giving more independence to the market forces. Western governments have accused the Chinese government of deliberately keeping the value of its currency low in order to gain advantage in the global export markets.

Experts have said that the move will encourage greater international use of the currency. The yuan will be able to trade as much as 2 percent on either side of a daily central bank reference rate, compared with the current 1 percent at present. People's Bank of China said in a statement on its website yesterday that the limit has been increased to 2 per cent. The new limit will come into effect from take effect tomorrow. The limit was earlier increased in April 2012 from 0.5 percent and was 0.3 percent in May 2007.