SHANGHAI/SINGAPORE - China's yuan hit a 14-month nadir on the first trading day of 2025, but it quickly bounced from lows of 7.31 per dollar, which traders say could reflect authorities' desire to rein in the currency's slide before Donald Trump returns to the White House.

The onshore yuan fell to 7.31 per dollar at the market open, piercing below 7.3 for the first time since Nov. 3, 2023. However, trades below that level disappeared from trading platforms later.

Responding to a Reuters request for comment, China's forex market regulator said both trading counterparties canceled their orders at 7.31 per dollar. The regulator didn't say why the orders were canceled.

Analysts and traders say the cancellation could be linked to a 'fat finger' error, or due to guidance from regulators who are keen to keep the yuan stable ahead of a looming trade war with the U.S.

The cancellation shows that "authorities think keeping the yuan stronger than the 7.3-per-dollar level at this stage is reasonable," said a trader at a Chinese bank.

China needs to closely monitor U.S. policies under Trump and adjust countermeasures accordingly, including yuan policies, said the trader, who declined to be named.

The U.S. President-elect has threatened to impose fresh tariffs on Chinese imports, keeping investors on edge about the impact on yuan-denominated assets.

The yuan lost 2.8% against the greenback in 2024 in its third straight year of losses, hit by a triple-whammy of a broadly stronger greenback, falling Chinese yields and rising trade tensions with other economies.

On Thursday, China's 30-year treasury yield fell below 1.9% to a record low, reflecting the gloomy outlook on China's economy and adding to depreciation pressure on the yuan.

China's central bank continued to set a strong guidance rate, underscoring authorities' unease over the yuan's recent declines.

Prior to market open, the People's Bank of China set the yuan midpoint at 7.1879 per dollar, 1,037 pips stronger than Reuters' estimate.

The yuan had been trading a whisker below 7.3 per dollar over the past two weeks, a level seen by some in the market as a major threshold.

Reuters reported last month that China's top leaders and policymakers are considering allowing the yuan to weaken this year as they brace for higher U.S. trade tariffs Trump.

(Reporting by Samuel Shen in Shanghai and Vidya Ranganathan in Singapore ; Editing by Jacqueline Wong and Shri Navaratnam)