The value of the Renminbi (RMB) yuan against the U.S. dollar hit a new high Thursday, with the central parity rate at 7.8697 yuan to one dollar, breaking the 7.87 mark.

The market exchange rate of the RMB against the dollar closed Wednesday at a record 7.8661.

The yuan's appreciation on Thursday followed previous records on Nov. 1 when the central parity rate hit 7.8720 and Nov. 8 when it was 7.8719.

The exchange rate was about 8.27 yuan per U.S. dollar for quite a long time before China's reform of the exchange rate system.

The government launched the reform in July last year to allow the yuan to float within a daily 0.3 percent band from the official central parity rate.

Market observers attribute the appreciation to the continuous slump of the U.S. dollar, saying expectations for an interest rate drop in the United States pressed the yuan's value up.

Last month, the U.S. Federal Reserve decided to keep the interest rate unchanged at 5.25 percent for the third time in a row since August.

Meanwhile, the anticipation that China's foreign exchange reserves will exceed one trillion U.S. dollars this month is considered another factor in the yuan's appreciation.

China's foreign exchange reserves had reached 987.9 billion U.S. dollars by the end of September, with a monthly average increase of 18.7 billion U.S. dollars for the first nine months.

The RMB was under heavy pressure to appreciate, but the currentfloating band of its exchange rate was wide enough, said Tang Xu, director general of the research department of China's central bank, at a recent seminar.