Not for the first time this year, talk that China could widen the trading band for the yuan is doing the rounds with some analysts saying a move could come as early as this weekend.
China's decision a week ago to scrap the floor on lending rates for commercial banks, as it takes another step towards opening up its financial markets, makes other reform measures such as widening the yuan's trading band and establishing a new interest-rate framework more likely, say analysts at Credit Agricole.
(Read more: Beijing loosens grip on rates—will it matter?)
"[One]message coming from the lending floor removal is that the currency regime will soon be liberalized as well," analysts at Credit Agricole said in a note published on Wednesday.
"The last time that the dollar/yuan trading band was widened in April 2012, the move was announced not too far from the timing of rate liberalization," they added.
(Read more: Is it time for China to push the yuan lower?)
The Chinese yuan, also known as the renminbi, is currently allowed to rise or fall by 1 percent in either direction from a level fixed against the dollar each day by the country's central bank.
"We expect another dollar/yuan band widening, to plus or minus 1.5 percent or plus and minus 2 percent around the fixing, in the very near future – most likely in Q3 and quite possibly this or next weekend," said the Credit Agricole analysts.