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Currencies

China's yuan sinks to fresh 11-year low against dollar

Reference rate cut for eighth straight session as Sino-US tensions simmer

The yuan depreciated beyond 7 against the dollar this month for the first time since 2008.   © Reuters

HONG KONG -- The yuan weakened as far as 7.0707 against the dollar in Shanghai on Monday, its lowest since March 2008, strengthening speculation that Beijing is willing to tolerate a gradual decline as trade tensions with the U.S. intensify.

The Chinese currency ended the session at 7.0679 to the greenback.

The People's Bank of China lowered its daily reference rate for an eighth consecutive session to 7.0211 yuan to the greenback, following selling momentum in the market. The currency is permitted to move just 2% above or below this level on the mainland.

The yuan softened beyond 7.1 on Monday in offshore trading, which is not subject to the same restrictions.

The currency depreciated below the psychologically important figure of 7 to the dollar on Aug. 5, days after the U.S. announced plans for another round of tariffs on Chinese imports.

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