China began its forex reforms in July last year

China's currency traded at 7.9845 to the dollar on Friday, up 0.09% from the close of 7.9920 on Thursday.

The new figure beat the yuan's previous post-revaluation high of 7.9850 on 7 July.

As part of World Trade Organization obligations, China last year abandoned the currency peg which had fixed 8.28 yuan to the US dollar for 10 years.

Export claims

The yuan was revalued by 2.1% to 8.11 per dollar on 21 July, 2005, when it was also freed from its dollar peg and allowed to float within managed bands.

Some US politicians have been claiming the yuan is artificially undervalued, allowing China to keep its export prices low.

As a result, critics in the US argue that the country is being flooded with cheap Chinese exports, leaving domestic rivals unable to compete and threatening jobs in the US industrial heartlands.

However, since the revaluation the currency has appreciated a further 1.57% against the dollar.

The latest strengthening came after the People's Bank of China set the mid-point of its exchange rate at 7.9897, stronger than Thursday's 7.9918.

'Credit crunch'

Meanwhile the bank has now also raised bank reserve requirements by 0.5 percentage points, from 15 August, in order to cool credit growth.

The central bank made a similar move on 16 June.

The move comes as China tries to cool a blistering economy that grew 11.3% in the second quarter from a year earlier.

"Given the pace of growth in China there may well be more of this," said Julien Garran, of Legal & General Investment Management.

"If they [the central bank] don't do it they raise the risk that there can be a significant credit crunch going forward.

"The big question is whether they are doing enough."