The yuan plunged beyond 7 per dollar for the first time in more than a decade after the central bank weakened its daily currency fixing past a key level.
The exchange rate tumbled 1.1% to 7.0175 per a dollar at 9:50 a.m. after China’s central bank set its daily reference rate at a weaker level than 6.9 per dollar for the first time since December. The offshore yuan slumped 1.3% to a record low, while the Shanghai Composite Index slid 1%.
The yuan declined 0.9% in mainland trading last week, its biggest loss since mid-May, after President Donald Trump abruptly escalated the trade war with new tariffs on Chinese goods. Beijing pledged to respond if the U.S. goes ahead with a plan to impose a 10% tariff on a further $300 billion in Chinese imports.