Yuan Surges by Most in Two Months After Trump, Xi Talk
Xu Wei
DATE:  Nov 02 2018
/ SOURCE:  Yicai
Yuan Surges by Most in Two Months After Trump, Xi Talk Yuan Surges by Most in Two Months After Trump, Xi Talk

(Yicai Global) Nov. 2 -- China's central bank amped up the yuan's central parity rate against the dollar by 299 basis points this morning, giving a much-needed jolt to the redback after the two countries' heads of state spoke yesterday.  

The People's Bank of China set the rate at 6.9371, strengthening the yuan by 0.4 percent against the greenback and marking the biggest gain since Aug. 28, data from the China Foreign Exchange Trade System shows. PBOC sets the benchmark on the morning of each business day, allowing spot rates to deviate 2 percent above or below the figure.

The yuan has lost more than 10 percent against the dollar since Feb. 1 as China and the US have exchanged blows in trade tariffs. Heightened import duties came into play in July and have been increased twice since. The US currently has tariffs targeting China exclusively to the tune of USD250 billion, while the Asian nation has hit back with USD110 billion of its own.

State-owned news agency Xinhua reported yesterday that Chinese President Xi Jinping and American President Donald Trump spoke on the phone that day, with the US leader saying he values the economic partnership between the two countries and looks forward to exporting more to China.

The pair should strengthen talk and hold open talks on the issues of concern for both sides, and seek a mutually acceptable solution to the trade issues, the report cited Xi as saying.

The US Dollar Index, the weighted mean of the dollar's value against six other major currencies, had slid by 0.88 percent to 92.2756 when the New York session closed yesterday. In night trading, the yuan spot rate closed at 6.9199, up 576 basis points from the previous day.

Editor: James Boynton

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Keywords:   Dollar,Yuan,Foreign Exchange,TRUMP,Xi,Trade Tension