The falling yuan has made holding Chinese assets less appealing to foreigners.
China's yuan strengthened, this comes just hours after the United States imposed a 25% tariffs on China.
'Matching the US dollar-for-dollar on the US tariffs would imply raising a 25% tariff on all US imports, including those that go into China’s exports.'
'Investors will remain bearish on the yuan, as they reprice in trade-war risks because the new developments are a reversal of previous positive progress.'
It is said that the Yuan from its current 6.65-to-6.90 range against the dollar is limited for now.
People’s Bank of China Governor Yi Gang said the that US and China have reached consensus on many crucial issues, including stepping away from competitive devaluation of currencies.
Yi Gang said that China will never use the exchange rate for competition reasons, or to increase China's exports, against what President Donald Trump is accusing China of.
Signs of progress between Beijing and Washington may help revitalise a rally in global equities that’s shown signs of stalling over the past week.
The yuan is subject to a hard-to-understand system in which the central bank fixes daily reference rates, and is frequently cited as influencing intraday trading as well.
Treasury Secretary Steven Mnuchin touts the currency pact as the strongest ever, though he offered no details, following two days of high-level talks in Washington between US and Chinese officials.
The Chinese currency has lost nearly 7% of its value to the dollar since the beginning of this year.
The currency declined 0.11% to 6.9695 per dollar as of 10.04am in Shanghai, within 0.5% of 7 – a level hasn’t been reached since the global financial crisis.
Faktor luaran seperti kebimbangan mengenai perang perdagangan dan pertumbuhan global turut menjejaskan ringgit.
The Fund's member countries agreed to debate ways to improve the World Trade Organization so it can better address trade disputes.
For Chinese stocks, which have entered a bear market even as US benchmarks climbed to record highs, the outlook depends on the country’s success in stoking consumption and sectors including technology and e-commerce.
The People’s Bank of China will probably pursue a looser monetary policy to shore up growth in face of the threats to trade, according to the analysis.
China said it welcomed the US invitation but it was unclear when the discussions would be held.
The volumes, which represent a portion of the offshore yuan market, surged as the yuan slid for a fourth straight month.
The US- China trade war may escalate as the closely watched US-China negotiations last week yielded no major progress.
The yuan has been Asia’s worst performer since March, but there is no sign of the kind of panic exhibited by the exodus of capital after China’s surprise yuan devaluation in 2015.
The cost of bearish wagers on the Chinese currency soared the most since January 2016 on Thursday.
China’s currency has slumped 7.6% over the past three months as the worst performer in Asia amid China’s trade spat with the US and a slowing economy.
Promoting the yuan’s global role requires freer use of the currency and exchange rate reform, which may need trade-offs with other priorities.
The yuan will likely be supported by an improvement in the economy through year-end and an inflow of money as foreign investors buy onshore bonds.