The dollar continued to gain against the yen and other major currencies after China poured cold water on speculation that the yuan could be allowed to appreciate further in the coming months. The People's Bank of China said earlier that Thursday's 2.1 pct revaluation of the yuan against the dollar must not be viewed as an initial step in a series of further adjustments to the currency. "The 2.1 pct adjustment does not mean that the yuan exchange rate has been appreciated as a first step and that there will be further adjustments," it said. HSBC's Mark Austin noted that the market "got overexcited about the revaluation", leaving scope for a further recovery for the dollar against the yen and other Asian currencies. The dollar has regained much of its recent losses against the yen, as well as other currencies, with the euro failing to benefit from a much better than expected Ifo survey of German business expectations this morning and dipping back below the 1.20 usd mark. "The dollar is broadly firmer this morning, continuing to regain some of its post-China losses against the yen, Australian dollar, and euro, despite a firmer than expected German IFO survey," said UBS currency analyst Daniel Katzive. The closely-watched Ifo index rose to 95.0 in July from 93.3 in June against expectations for a much smaller rise to 94.0, with confidence boosted by a fall in the euro's value as well as the prospect of political change in Germany following the upcoming elections. Looking ahead, US consumer confidence data from the Conference Board released this afternoon may attract some attention. Elsewhere, the pound gained against the euro after a survey from the Confederation of British Industry showed an improvement in UK manufacturing in July, although concerns about firms' pricing power remain.