Dubai – Mubasher: China's central bank set on Thursday the benchmark exchange rate for the yuan at a four-year low against the US dollar, a move that reflects reduced expectations for the unit following devaluation.

The People's Bank of China fixed the locally currency’s exchange rate at 6.4085 to the dollar, 0.07 % lower than the previous day. But it was the lowest since August 2011, the Shanghai Securities News said on its website.

The move follows an interest rate cut announced on Tuesday and a slumping stock market, which has fallen more than 40 % since peaking in mid-June.

The central bank on 11 August devalued the yuan by nearly 2%, saying the decision was aimed at moving towards a more flexible exchange rate.