The yuan fell by 1,848 points to 6.95 yuan against the euro, and by 1,205 points to 5.05 yuan against the Japanese yen.
On Tuesday, the central parity rate was 6.2298 yuan per dollar, after the People's Bank of China lowered the official reference rate of the yuan against the dollar to a record 1.9 percent. On Monday, the rate was 6.1162.
In China's spot foreign exchange market, the yuan can diverge a maximum 2 percent from its daily fixing.
The regulator said it was a single measure, and that it will maintain the stability of the yuan at the 'rational' level, in order to better reflect market development in the yuan-dollar exchange rate.
Chinese currency was kept stable for a long enough time at around 8.3 yuan per dollar until the summer of 2005 when it started to strengthen. Since June 2008, yuan was held at 6.8 against the US dollar, and in September 2010 it began to grow again. The peak was in January 2014, when the rate was 6.0 yuan against the US dollar.