The Chinese government said today it will scrap its currency’s fixed exchange rate against the U.S. dollar and let the yuan float in a tight range against a group of curriences.

The change is seen as a first step in eventually letting the yuan float freely.

The new trading regime goes into effect on Friday, the Chinese government said in an announcement.

The yuan will be revalued to 8.11 per U.S. dollar. Previously, the yuan had been pegged at 8.28 per U.S. dollar where it had been almost unchanged since the Asian financial crisis of 1997/98.

China’s long refusal to revalue its currency led the United States and other countries to complain that the yuan was undervalued, giving Chinese companies an unfair competitive advantage.

The price of gold firmed on euro gains after China’s announcement, and the Canadian dollar was up more than half a U.S. cent. The loonie was down from earlier highs but still ahead 0.54 of a cent at US82.41¢ as the Canadian currency benefited from sentiment that the move would benefit the U.S. economy.