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Traders ask how low China will go as yuan hits 4-month dip

Analysts suspect official tolerance in Beijing for softer currency

A man scoops yuan coins at a laundry in Zhengzhou, China.   © Reuters

SHANGHAI -- The latest flare-up in the U.S.-China trade war has driven the yuan to its lowest level in four months, a trend that currency market watchers say Beijing may be tolerating to prop up exports.

The People's Bank of China, the country's central bank, on Tuesday set a yuan reference rate of 6.8365 to the dollar -- the weakest since early January. The currency fell to 6.88 at one point in daytime trading.

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