The Chinese yuan's central parity rate firmed against the U.S. dollar on Monday. The People's Bank of China set the midpoint at 6.7641, 217 basis points firmer from the last session. The advance was the yuan's largest daily gain in a month.

The yuan has been through a volatile October with its midpoint falling more than one percent against the U.S. dollar.

Analysts say the US Federal Reserve's pending rate hike outlook is to blame. They also say the Chinese currency's forex rate volatility is a reflection of the dollar's strength, but not the yuan's weakness.