The People's Bank of China on Wednesday set the daily reference rate of the yuan against the US dollar at 6.1980, the highest in 19 years since China unified official and market exchange rates at the end of 1993.

The daily fixing of the yuan has strengthened by 1.41 percent since the start of the year against the dollar as indicators have shown capital flows into the world's second-largest economy accelerated in recent months.

The currency is allowed to trade within 1 percent in each direction around the daily reference rate.

The yuan rose 0.13 percent to 6.1460 per dollar as of 10:08 am in the Shanghai foreign exchange market, taking the two-day gain to 0.33 percent, the most since March 22, 2012, according to data compiled by Bloomberg.

Earlier the currency rose by as much as 0.19 percent to 6.1424, the strongest level since the end of 1993.

Analysts have forecast continuous appreciation pressure on the yuan as major economies announced a new round of monetary easing. The central bank of Australia on Monday announced it was cutting interest rates following the same moves by the European Central Bank and the Indian central bank.