The announcement is a part of the "Great Correction" taking shape in the aftermath of the recession.
Beijing unpegged the Chinese yuan from the dollar last weekend, leading to a half-point rise against the US currency this week. The value of China's currency has been a highly contentious issue with trade partners.
China and Taiwan are completing an agreement to increase bilateral trade. Taiwan's government says the trade deal will boost economic growth; the opposition party says it will erode sovereignty.
China money: The yuan will now be worth more against the dollar, boosting Chinese consumers' buying power.
Currency charts: China’s yuan strengthened Monday, but the euro faltered. Dow average slipped 8 points.
A jump in the value of Chinese currency, the yuan, would make products manufactured in China more expensive, but could also help US manufacturers remain competitive abroad.
The partial revaluation of the yuan does hint at a China becoming a better market economy, one that allows its citizens to make their own economic choices.
China is under international pressure to revalue its currency to address trade imbalances. It didn't do it at this week's bilateral meeting with US officials but may ahead of G-20 meetings in June.
European stock markets fell again and the American stock market opened lower over European worries on Monday.