AKIPRESS.COM - China's yuan hit a four-year low on Wednesday, falling for a second day after authorities devalued it in a move that sparked fears of a global currency war and accusations that Beijing was unfairly supporting its struggling exporters.

Spot yuan in China fell to 6.45 per dollar, its weakest since August 2011, after the central bank set its daily midpoint reference at 6.3306, even weaker than Tuesday's devaluation, reports Reuters.

The currency fared worse in international trade, touching 6.59.

The central bank, which had described the devaluation as a one-off step to make the yuan more responsive to market forces, sought to reassure financial markets on Wednesday that it was not embarking on a steady depreciation.

"Looking at the international and domestic economic situation, currently there is no basis for a sustained depreciation trend for the yuan," the People's Bank of China (PBOC) said.

Foreign exchange traders later said state-owned banks were selling dollars on behalf of the PBOC to keep the yuan around 6.43.

"Apparently, the central bank does not want the yuan to run out of control," said a trader at a European bank in Shanghai.

A trader at another European bank said the unexpected devaluation had caused "some panic" in markets.

"Although the central bank made explanations again today, stressing the yuan would not show sustained depreciation, the market is very jittery," he said.

Analysts at BMI downgraded their end-year forecasts for the currency to 6.83, down 10 percent from pre-devaluation levels.

The yuan has lost 3.5 percent in China in the last two days, and around 4.8 percent in global markets.

Its slide pulled down other Asian currencies on Wednesday, with Indonesia's rupiah and Malaysia's ringgit hitting 17-year lows, and the Australian and New Zealand dollars touching six-year lows.

Indonesia's central bank pinned the rupiah's fall directly on the yuan devaluation and said it would step into the foreign exchange and bond markets to curb volatility.