China lowers yuan midpoint for 3rd day to weakest in nearly 3 weeks

SHANGHAI, Sept 21 (Reuters) - China's central bank lowered its official yuan midpoint for a third straight day to 6.5867 per dollar on Thursday, the weakest level since Sept. 1, reflecting strength in the greenback overnight after the U.S. Federal Reserve signaled it may raise interest rates for a third time this year.

Thursday's fixing was 197 pips or 0.3 percent weaker than the previous fix of 6.5670 on Wednesday.

The dollar rose after a hawkish-sounding Federal Reserve heightened expectations for an interest rate hike in December.

After concluding a closely watched two-day policy meeting on Wednesday, the Fed left interest rates unchanged as expected but signaled it still expects one more increase by the end of the year despite a recent bout of low inflation. (Reporting by Winni Zhou and Andrew Galbraith; Editing by Sam Holmes)