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China’s Yuan tacks on PBOC's dovish statement
On Wednesday, China's Yuan managed to ascend versus the evergreen buck, just a day after the country’s main financial institution had markets assured it would keep the national currency steady in the face of heightened concerns as for trade clashes. However, equities were still under pressure.
As a matter of fact, Chinese currency along with equity markets have been wavering ahead of July 6, when American duties on $34 billion worth of China’s products are set to come into effect. The Chinese government has told it would response with duties on products from the United States.
In June, the Chinese Yuan faced its worst month on record, losing approximately 3.3% of its value versus the US currency, and the decline resumed on Monday.
On Tuesday, it bounced off after the statement from PBOC Governor Yi Gang and resumed riding the updraft on Wednesday, thus putting the Chinese Yuan on track for its first two-day gaining marathon since the middle of June as well as the best day since late March.
The Chinese Yuan hit 6.6009 against the greenback, just 0.65% stronger than Tuesday’s outcome.
Some traders pointed out that the PBOC's clue turned out to be clear enough, although the market would monitor and timely react to developments ahead of July 6.
Major Chinese equity indexes happened to be less enthusiastic. They started the trading day flip-flopping around Tuesday's close before jumping with both feet into negative territory to stay there.
The CSI300 Index headed south by 1.3%, the Shanghai Composite Index lost 1%.
An index gauging the 50 most representative blue-chips in Shanghai, also known as "nifty 50", headed south approximately 1% showing a 14-month minimum.
The Hang Seng Index dived more than 1.3%, while an index, gauging mainland companies, dipped nearly 1.7%.
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