China's economy expanded 7.4 percent last year, its lowest level in 24 years, but still managed to meet the 10 million job creation target set for the whole year as consumption contributes more to economic growth.

Proponents of the yuan's depreciation argue that a weaker yuan will add to the competitiveness of China's exports, but economists say that its impact is likely to be very limited.

"Large yuan depreciation will help exports, but in reality it will be difficult to implement given that China's trade surplus reached new historical highs in the second half last year, and the current account surplus widened. It may also lead to competitive devaluation from other countries, which will compromise the initial purpose of currency depreciation." said JP Morgan China Chief Economist Zhu Haibin in a research note.

Though the spread between the reference rate and spot trading has repeatedly widened to the daily limit of 2 percent, analysts say a further widening of the yuan's trading band is also unlikely in the near term.

"If the central bank does so, the market will misinterpret it as allowing the yuan to weaken further," according to China Merchant Bank's Liu.

China widened the yuan's trading band to 2 percent on either side of the reference rate in March, a move that snapped the yuan's rising trend against the dollar and changed the perception that the currency is a one-way bet.

"Given the scale of China's economy and its trading volume, the yuan's fluctuation shouldn't be too dramatic and the existing trading band is already wide enough," said Zhao of the China Financial Futures Exchange.

It is the reference rate, Zhao said, that authorities should work on going forward to bring more transparency and better reflect the market's opinion on the currency.

China has been promoting the yuan's global use and a stable yuan would gain more acceptance in global trade.

"After all, you don't want to use a currency that goes up and down too hard," Zhao said.