China's yuan holds gains as PBOC hikes mid-point by most since 2005

* Yuan pauses after strengthening around 1 pct since Tuesday

* Set for the best week since July as cbank battles

speculators

* Offshore overnight borrowing rates spike

* Analysts expect depreciation to continue in 2017

(Repeats)

By Winni Zhou and John Ruwitch

SHANGHAI, Jan 6 (Reuters) - China's yuan held onto its gains

after a two-day rally on Friday as borrowing rates for its

offshore component soared and the central bank set a stronger

guidance rate for the currency, sign

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