Shanghai, Aug 5 (AFP/APP):The Chinese yuan fell to its lowest level against the dollar since August 2010 in morning trade on Monday, fuelling speculation that Beijing is allowing currency depreciation to counter threatened US tariffs.
The offshore currency weakened to 7.1085 to the dollar, days after US President Donald Trump announced a plan to impose fresh tariffs on another $300 billion in Chinese goods, sharpening trade war tensions between the world’s two biggest economies.
The onshore yuan also tumbled, hitting 7.0307 in Monday morning trade to reach its lowest level since 2008.
Both the onshore and offshore yuan breached the 7.0 level against the dollar, which investors see as a key threshold in currency value.
Trump has frequently accused China of artificially devaluing its currency in order to support its exports — charges long denied by Beijing.
The US president jolted global stock markets last week when he issued the threat of more tariffs just a day after US and Chinese trade negotiators revived talks aimed at ending the year-long dispute.
The extra 10 percent duties Trump threatened to implement from September 1 would mean he has now targeted virtually all of the $500 billion in goods America buys from China every year.