The US president today accused China of "currency manipulation" for lowering the Chinese currency's exchange rate by half a point to 6.9 yuan to one dollar.
The yuan price against the dollar fell to its lowest level within a decade. Beijing also ordered its state-owned companies to suspend US agricultural imports.
“China has lowered the price of its currency to a historically low level. This is called “currency manipulation”. Are you listening to the Federal Reserve? This is a serious violation that will weaken China !, writes Donald Trump on Twitter this Monday, August 5.
In turn, the People's Bank of China has made it public to ensure that the yuan will not be used as a weapon in trade wars.
"I am confident that the yuan will remain a strong currency despite recent fluctuations due to external uncertainties," said central bank governor Yi Gang, quoted by Bloomberg.
The Chinese central bank's decision comes after Donald Trump recently announced a 10 percent increase in customs tariffs from September by $ 300 billion (268 billion euros).
Last week, Chinese Foreign Minister Wang Yi criticized Washington's decision to increase customs duties on Chinese goods. "The imposition of fees is by no means a constructive way to resolve economic and trade frictions," said Wang, quoted by Lusa.
In turn, the US Government defended its decision. “China has been taking advantage of trade for decades at the expense of the United States and other Asian countries. This needs to end. President Trump has said he will solve this situation and that requires determination, ”US Secretary of State Mike Pompeo said on Friday.
As a result, Wall Street opened its session on negative ground, with the S&P 500 retreating 2.35%, Nasdaq losing 3% and Dow Jones falling 2.30%.
China dropped its price to its almost an historic low. It's called “currency manipulation.” Are you listening to the Federal Reserve? This is a major violation which will greatly weaken China over time!
– Donald J. Trump (@realDonaldTrump) August 5, 2019
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