1st LD-Writethru: Chinese yuan strengthens to 6.8906 against USD Wednesday

The central parity rate of the Chinese currency renminbi, or the yuan, strengthened 87 basis points to 6.8906 against the U.S. dollar Wednesday, according to the China Foreign Exchange Trade System.

Chinese authorities have reiterated that the yuan will stabilize this year on the back of a firming economy and rising confidence in the country's growth prospects.

China's GDP growth is likely to accelerate in the first quarter of the year following a pick-up in industrial activity and improving domestic demand, according to a report by China International Capital Corp. (CICC).

The investment bank said in the research report that GDP growth could quicken to 6.9 percent in the first quarter from 6.8 percent in the fourth quarter of 2016.

CICC expected China's retail sales of consumer goods to increase 10.2 percent year on year in March, accelerating from the 9.5 percent rise registered for January-February.

The country's manufacturing purchasing managers' index came in at 51.8 in March, higher than 51.6 recorded in February, reinforcing signs that the economy is firming up.

In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.

The central parity rate of the yuan against the U.S. dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day. Endi