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UPDATE 1-China state banks bought dollars on Friday to drag yuan lower -sources

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SHANGHAI/BEIJING, Sept 6 (Reuters) – China’s major state-owned banks were seen buying U.S. dollars in the onshore spot market late on Friday, pushing the yuan lower, three sources with direct knowledge of the matter said.

The onshore spot yuan strengthened on Friday after disappointing U.S. jobs data pushed the dollar lower. The move by the state banks was seen as an effort to rein in rapid yuan appreciation, with one source saying the aim was to ensure the currency closed on the weaker side of the 6.45 per dollar level.

One of the sources said authorities do not want overly sharp rises or falls in the exchange rate, especially as markets face rising overseas uncertainties, including the prospect of the U.S. Federal Reserve tapering pandemic-era stimulus.

The onshore yuan finished Friday’s session at 6.4585 per dollar after rising to a high of 6.4305, the strongest since July 17. The dollar came off its immediate…

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