China yuan firmer as manufacturing seen recovering

* HSBC China PMI falls a touch in Sept to 55.0

* Dollar/yuan NDFs fall to a nearly four-month low

SHANGHAI, Sept 30 - The yuan was slightly firmer against the dollar on Wednesday after a survey showed China's manufacturing sector kept up its steady pace of recovery in September.

HSBC's China Purchasing Managers' Index (PMI) fell slightly in September to 55.0, easing from August's 16-month high of 55.1 but still signalling strong growth in factory output, new orders and employment.

It was the sixth month in a row that the index, compiled by British research firm Market, has been above 50.

A companion PMI survey for September, produced for the National Bureau of Statistics, is due to be released on Thursday. Other economic data will be posted in mid-October.

The People's Bank of China set the daily yuan mid-point, or its reference rate, at a slightly weaker 6.8290 against the dollar from Tuesday's 6.8288.

That guided spot yuan to trade at 6.8275 by midday, only marginally higher from Tuesday's close of 6.8280.

"The marginal decrease in the PMI still shows that China's economic recovery is maintaining upward momentum," said a dealer at an Asian bank in Shanghai. "But it's not time for yuan appreciation."

Several dealers said they expected the yuan to move between 6.8250 to 6.8350 after the National Day holiday.

Offshore one-year dollar/yuan NDFs fell to an intraday low of 6.7097 bid at midday on Wednesday, their lowest since June 10 and down form Tuesday's close of 6.7250.

Twelve-month yuan appreciation implied by NDFs, which moves inversely with the forwards, rose to 1.78 percent measured from the Chinese central bank's daily mid-point, compared with 1.54 percent implied at Tuesday's close.

The slight fall in NDFs was merely a reflection of the U.S. dollar's decline on Wednesday, a dealer said.