The Chinese currency Renminbi, or the yuan, went up 25 basis points to 6.1321 against the U.S. dollar on Monday, according to the China Foreign Exchange Trading System.
In China's foreign exchange spot 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 before the opening of the market each business day.
China widened the yuan's daily trading band from the current 1 percent to 2 percent on Monday.
The move is aimed at enhancing the floating flexibility of the Renminbi exchange rate, making capital allocation more efficient, facilitating economic restructuring and beefing up the decisive role of the market in allocating resources, the People's Bank of China, the country's central bank, said in a Saturday statement.
China has gradually raised its currency's daily trading limit, from 0.3 percent in 1994 to 0.5 percent in 2007 and 1 percent in 2012.