Let's hear what economists have to say about the yuan's direction.

"We see the dollar index is at around 102, a peak in a short-term view. The yuan is now one of the strongest currencies in the world. The recent losing streak has actually wiped off less than the loss of the Japanese yen or the euro versus the dollar. My view is not to worry too much as the dollar index is losing strength," said Yao Yudong, Chief Economist, Dacheng Fund MGT.

"For electronic mechanicals and low end manufacturing goods, a weak yuan bodes well for China's exports of those products. For importers of crude and iron ore, the pressure is building," said Yan Se, Sr. Economist, Standard Chartered Bank.

"We look at the yuan's weakening in two aspects. One, it's a big deal as forex volatility tends to lead to currency speculation which means unstable capital flows through China," said Li Yining, Economist & Peking University Professor.

"But it is also not scary. China's economy is solid, and the yuan's market position is firm. The core issue here is how significant will the yuan's volatility be. If it is too turbulent, there's a problem."