China denies USA allegation of currency manipulation
Jul 25 2018
"As to the U.S. being bent on provoking a trade war, China does not want a trade war but is not afraid of a trade war", Geng said, when asked about Trump's threat to impose across-the-board tariffs on Chinese goods.
China's regulatory tightening has driven up corporate borrowing costs, prompting the central bank to cut banks' reserve requirements three times this year, with further cuts widely expected.
"China does not want a trade war, but we are not afraid", he continued, adding that "threats and intimidation will never work", Efe news reported. The index started the year at 3,314 points and dipped the lowest level of last two years reaching 2,691 points in July. China's trade surplus with the United States has grown to a record high of almost $29 billion in June. The major traded 0.1 percent up at 1.3137, having hit a low of 1.2957 on Thursday; it's lowest since September 2017.
Asian stocks followed that lead on Monday with Japan's Nikkei .n225 stumbling 0.9 percent.
"Trump's comments that he was "ready to go to 500" of tariffs in imports from China; that he was "not thrilled" about the prospects of Fed hikes and that "China, the European Union and others have been manipulating their currencies" saw a volatile close to the week". "It does feel like we are hearing far too much from the President's Twitter account at the moment and the market is not receiving many of his comments well", said Nick Twidale, analyst at Rakuten Securities Australia. Japanese government bond prices fell sharply on Monday, with the benchmark 10-year yield hitting its highest level in almost six months, following reports that the Bank of Japan is actively discussing changes to its policies.
A weakening Chinese yuan against greenback due to concerns over trade wars may mobilize a liquidity shock, Ben May, an economist at Oxford Economics, has said. It's also expressed a preference for a weaker dollar, which can spur United States exports. Elsewhere, the euro dithered near a two-week top of $1.1746.
In individual market movers, shares of telecommunications equipment maker ZTE jumped 1.5% in Hong Kong rose 0.6% in Shenzhen.
The threatened tariffs are far greater than the value of goods the USA imports from China and Reed Cavendish Wealth Management analysts say China may need to think of alternative methods of retaliation.
USA crude CLcv1 settled down 0.54 percent at $67.89 per barrel and Brent LCOcv1 ticked down 0.01 percent to $73.06.
USA crude settled up 1.44 percent at $70.46, while Brent settled at $73.07, up 0.68 percent.
Spot gold was little changed near a one-week high at $1,229 an ounce while US gold futures for August delivery were marginally lower at $1,229.80 an ounce.