The offshore yuan fell the most in two weeks, tracking Asian
currencies and stocks lower as a global selloff eroded the appeal of
riskier assets.
Equity markets sank into bear territory
amid skepticism central banks can arrest a slide in the world economy.
The Bloomberg-JPMorgan Asia Dollar Index fell for a second day while
stocks in Hong Kong headed for their lowest close in more than three
years.
Federal Reserve Chair Janet Yellen said this year’s global tumult was in response to a drop in the yuan and in oil prices, and not the U.S. central bank’s rate increase in December. A gauge of the dollar’s strength rose 0.1 percent on Monday, paring its decline from Feb. 5 to 0.8 percent.
The yuan traded in Hong Kong fell 0.16 percent to 6.5399 a dollar as of 11:50 a.m. local time, ending three days of gains, according to China Foreign Exchange Trade System prices.
The currency is headed for a 0.4 percent advance for the week. China’s onshore financial markets will reopen on Monday, after a week-long holiday, with investors watching out for what the People’s Bank of China will do with the yuan’s reference rate.
“There’s a tug of war right now as people are debating whether the dollar’s weakness and its effect on emerging-market currencies will be sustainable,” said Sim Moh Siong, a foreign-exchange strategist at Bank of Singapore Ltd. China’s central bank is likely to keep the yuan’s fixing stable on Monday, he added.
Federal Reserve Chair Janet Yellen said this year’s global tumult was in response to a drop in the yuan and in oil prices, and not the U.S. central bank’s rate increase in December. A gauge of the dollar’s strength rose 0.1 percent on Monday, paring its decline from Feb. 5 to 0.8 percent.
The yuan traded in Hong Kong fell 0.16 percent to 6.5399 a dollar as of 11:50 a.m. local time, ending three days of gains, according to China Foreign Exchange Trade System prices.
The currency is headed for a 0.4 percent advance for the week. China’s onshore financial markets will reopen on Monday, after a week-long holiday, with investors watching out for what the People’s Bank of China will do with the yuan’s reference rate.
“There’s a tug of war right now as people are debating whether the dollar’s weakness and its effect on emerging-market currencies will be sustainable,” said Sim Moh Siong, a foreign-exchange strategist at Bank of Singapore Ltd. China’s central bank is likely to keep the yuan’s fixing stable on Monday, he added.
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