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China Sets Yuan Fix at Weakest Since 2008 After Currency Drop

Published 25/05/2020, 02:20
Updated 25/05/2020, 02:45
© Bloomberg. Genuine bundles of Chinese one-hundred yuan banknotes are arranged for a photograph at the Counterfeit Notes Response Center of KEB Hana Bank in Seoul, South Korea, on Monday, Aug. 14, 2017. China's factory output and investment slowed somewhat in July, according to data released today, yet the yuan appeared not to take the data as negative, if in fact it's paying attention to it at all. Photographer: SeongJoon Cho/Bloomberg

(Bloomberg) -- China set its daily yuan reference rate at the weakest level since 2008 after increasing political tensions with the U.S. drove the currency to a seven-month low.

The People’s Bank of China (OTC:BACHY) set the yuan fixing at 7.1209 per dollar. That compares with the 7.122 average estimate in a Bloomberg survey of traders and analysts. The fixing limits the onshore yuan’s moves to 2% in either direction.

The offshore rate, which edged toward the weakest level on record last week, was little changed at 7.1502 per dollar on Monday.

The onshore yuan last closed at 7.131 per greenback in Shanghai on Friday. The daily fixing is calculated with formulas that take into account factors such as the previous trading day’s official close at 4:30 p.m, the yuan’s move against a basket of currencies and the moves in other major exchange rates.

©2020 Bloomberg L.P.

© Bloomberg. Genuine bundles of Chinese one-hundred yuan banknotes are arranged for a photograph at the Counterfeit Notes Response Center of KEB Hana Bank in Seoul, South Korea, on Monday, Aug. 14, 2017. China's factory output and investment slowed somewhat in July, according to data released today, yet the yuan appeared not to take the data as negative, if in fact it's paying attention to it at all. Photographer: SeongJoon Cho/Bloomberg

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