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The People's Bank of China, amid a new mutual increase in duties from the United States, weakened the yuan to the dollar immediately by 0.6 percent, according to the regulator. The yuan has lost 411 points - the average exchange rate for today is 6.8365 per dollar, while on the eve it was 6.7954.
Since the beginning of the year, the Chinese currency has weakened considerably, although the Central Bank has assured that it will keep it at a rational and stable level, and the Chinese authorities, including Premier Li Keqiang, have repeatedly stated that they are not going to turn it into a tool for responding to a trade dispute with the United States. As reported by Bloomberg, citing sources, at trade negotiations, US representatives asked Beijing to maintain a stable yuan rate. Otherwise, they warned, any attempt to devalue the yuan Washington will respond with higher tariffs. In this case, Bloomberg notes, the depreciation of the yuan may be a strategy to counter the increase in US duties. In August 2015, the People's Bank of China lowered the yuan rate by three percent at once (from 6.2 to 6.4 per dollar) - this was a shock for global stock markets. Then there were three more waves of weakening of the Chinese currency, and experts argued that the Central Bank deliberately devalued the yuan to stimulate exports. Chinese authorities have denied these claims.
The US-Chinese trade war began after President Donald Trump announced an increase in duties on Chinese imports of hundreds of millions of dollars. Beijing responded with mirror measures.
Last week, the 11th round of the US-China trade negotiations was held in Washington, but it ended without result. Since May 10, the next increase in US duties — $ 200 billion on Chinese goods — came into force. In addition, Trump ordered to prepare a further increase, which will affect goods by more than 300 billion. China, in response from June 1, will impose increased duties on US imports of $ 60 billion.