China’s yuan hits 16-month low amid fears over Trump tariffs
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CSI 300 blue-chip stock index also trades weakly, hitting its lowest point since September. China’s currency hit a 16-month low on Monday, despite efforts by the central bank and stock exchanges to soothe investor worries about impending US tariffs under a Donald Trump presidency.
The tightly controlled yuan reached 7.3301 per US dollar, its weakest level since September 2023. It has routinely hit multi-month lows since Trump won the US election, promising massive tariffs on Chinese imports. The CSI 300 blue-chip stock index also traded weakly on Monday, hitting its lowest point since September, dropping at least 0.9% before closing down 0.2%. It came after the index reported its biggest weekly losses in more than two years last week, falling 5%.
With two weeks until Trump begins his second presidency, expectations of his promised big tariffs on Chinese imports have rattled markets in China, driving down mainland bond yields and destabilising stocks. It has fed an already jittery market, worried about the country’s ongoing economic troubles which have triggered capital outflows.
In response stock exchanges reportedly asked several large mutual funds last week to restrict their selling of stocks to keep the market higher, according to Reuters. George Magnus, a research associate at Oxford University’s China Centre and at SOAS China Institute, London, said this might indicate concerns that foreign holders of Chinese equities were rushing to sell.
