BEIJING, April 10 (Xinhua) -- China's currency, the yuan, was set to trade at 6.9920 yuan against the U.S. dollar on Thursday, breaching the 7-yuan mark for the first time since the government unpegged it from the dollar in 2005.

    Following an overnight fall of the dollar, the central parity rate of the yuan, or Renminbi (RM, gained 105 basis points to 6.9920 yuan against the dollar on Thursday, according to the China Foreign Exchange Trading System.

    Shen Minggao, an economist at Citigroup in Beijing, said that like many economists, he was not surprised to see the yuan to break the 7-yuan mark.

    "It was quite natural," he said, citing the dollar's fall against other major currencies, especially the euro, since the second half of last year along with an unfolding U.S. credit crisis plaguing the U.S. economy.

    The yuan has gained 4.47 percent this year based on Thursday's trading price, or 15.99 percent since the new currency regime was imposed in July 2005.