Yuan closes up slightly but short of record high

* C.bank sets midpoint at 8-month high

* Spot market transactions balanced - traders

* More appreciation expected in near term

(Updates to close)

SHANGHAI, Jan 15 (Reuters) - China's yuan exchange rate closed up slightly on Tuesday on bullish sentiment, but the currency stayed shy of Monday's historic intra-day high despite aggressive midpoint guidance from the central bank.

The yuan changed hands at 6.2136 per dollar at the close, 0.9 percent stronger than Monday's close of 6.2192.

During morning trade on Monday, the yuan reached an all-time intra-day high of 6.2124 per dollar.

The central bank on Tuesday set its midpoint at 6.2691 per dollar, a mere four pips firmer than Monday's fix of 6.2695 and setting an 8-month high.

The People's Bank of China (PBOC) allows the exchange rate to rise or fall 1 percent from the midpoint it sets each morning.

The dollar index has stabilised this week after posting steep declines Thursday and Friday. The central bank usually refers to overnight moves in the dollar when setting its midpoint, traders say.

While spot trading range was tighter than on Monday, traders said balanced supply and demand from clients kept transaction volumes healthy.

One trader at a major state-owned bank said that given wider optimism about the Chinese economy, he expects the yuan to appreciate further appreciation in the near term.

"The midpoint settings are quite strong, and the economic data is really not bad, and that means more pressure to appreciate in the near future."

Transaction volumes closed at $18.6 billion, down slightly from the $20.1 billion posted on Monday but still above average. China's forex market has averaged more than $11 billion per day since regulators began publishing transaction volumes in November 2012.

OFFSHORE MARKETS

The offshore yuan (CNH) continued to trade at a premium to the onshore market, changing hands at 6.1912. The premium narrowed to 2.21 basis points from Friday's 11-month high of 3.89 bps.

Analysts say the premium represents expectations by foreign investors that the central bank will let the yuan appreciate further. Because the offshore market is not restrained by the PBOC's midpoint, it occasionally expresses more optimism or pessimism about the spot rate than the onshore spot market is able to.

Non-deliverable one-year forwards, which are settled against the official midpoint, were quoted at 6.2822 in Hong Kong, implying expectations of slight depreciation for the midpoint in the next 12 months.

(Additional reporting by Michelle Chen in Hong Kong and Li Wenke in Beijing; Editing by Richard Borsuk)