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在线翻译:
szdaily -> Markets -> 
Yuan swings as trade clash creates fears
    2018-07-23  08:53    Shenzhen Daily

THE yuan took its largest one-day tumble in two years Friday before recovering, the latest sign that investors are struggling to get a grip on the trade clash between the United States and China and the uncertainty it is creating in financial markets.

The People’s Bank of China lowered its yuan midpoint for the seventh straight trading day to 6.7671 per dollar Friday, 605 pips, or 0.9 percent, weaker than the previous fix of 6.7066.

The latest bout of yuan weakness, catalyzed by concerns over the brewing China-U.S. trade war and a slowing Chinese economy, has seen the yuan shed 7.6 percent of its value against the dollar since the end of the first quarter of this year.

Friday’s fixing was the lowest since July 14, 2017, and represented the biggest one-day weakening in percentage terms since June 27, 2016.

The yuan snapped back Friday, posting gains that left it up 0.2 percent against the dollar, after U.S. President Donald Trump lashed out at the strength of the U.S. currency and the Federal Reserve’s plans to raise U.S. interest rates.

Investors said Trump’s latest remarks add to the growing unease in markets over the U.S.-China relationship. The standoff figures to increase volatility in foreign exchange and interest rate markets.

“Fermenting all this uncertainty certainly goes against the goals of the Trump administration,” said Eswar Prasad, a trade professor at Cornell University. “It creates more uncertainty in the global trading environment, and all that uncertainty ends up...putting more upward pressure on the dollar.”

Ken Cheung, senior Asian foreign exchange strategist at Mizuho Bank in Hong Kong, said investors were unsure of the future for the yuan.

“Investors do not know how far the yuan could fall,” he said. “(The authorities) might want to keep economic growth stable, and the direct impact of a weaker yuan could offset some negative impact from the trade war. But it will be hard to maintain confidence among foreign investors in purchasing yuan-denominated assets.”

At the heart of Trump’s complaints is that the strength of the U.S. dollar helps other countries by making U.S. goods more expensive.

The spot yuan market shrugged off the comments, though, opening at 6.7950 per dollar Friday before weakening past 6.8 per dollar to a low of 6.8128 at one point. It recouped all the losses in the afternoon. (SD-Agencies)

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