The Chinese currency, or the yuan, rose to a new high of 6.585 against the U.S. dollar Wednesday, according to the China Foreign Exchange Trading System.

The central parity rate of the RMB, or the yuan, was 10 basis points higher than the previous record of 6.586 set on Feb. 1, the previous trading day.

The yuan appreciated 3.6 percent last year, but some analysts predict it could rise further against the dollar this year as the People's Bank of China (PBOC), the central bank, attempts to cool accelerating inflation.

The PBOC announced Tuesday it would raise the benchmark one-year borrowing and lending rates by 25 basis points from Wednesday.

On China's foreign exchange spot market, the yuan can rise or fall 0.5 percent from the central parity rate each trading day.

The central parity rate of the RMB against the U.S. dollar is based on a weighted average of prices before the opening of the market each business day.