China's central bank on Thursday set the official reference rate for the Chinese currency at 7.0039 yuan per dollar — the weakest level since April 21, 2008.

Investors are watching the currency closely after it breached the important 7-yuan-per-dollar level on Monday. That prompted the U.S. Treasury department to label Beijing a currency manipulator.

It was the first time since the global financial crisis in 2008 that the midpoint was set weaker than 7 per dollar, according to Reuters.

Economists polled by Reuters had expected the People's Bank of China to set the yuan at 7.0205 per dollar on Thursday. The yuan midpoint was set at a stronger level of 6.9996 per dollar on Wednesday.

A weaker yuan makes Chinese exports more attractive, and the Trump administration has frequently complained it's giving Beijing a trade advantage.

The yuan inched higher on Thursday, with the onshore yuan gaining 0.2% to change hands at 7.0452 per dollar, while the offshore yuan rose 0.21% at 7.0674 against the greenback in Asia afternoon trade.

China allows the yuan to trade within a narrow band of 2% from each day's midpoint.