(Bloomberg) – China's yuan fell past $ 7, a level that had long been a focus of investors as a line in the sand for the country's policy makers. The move pulled down other Asian currencies and worsened stock sales.
Chinese stocks saw more modest falls. In the past, Chinese government funds have in some cases increased the market. China's yuan saw the biggest fall since August 2015, when officials announced a surprise devaluation that roiled the markets at that time. People's Bank of China said it is able to keep the currency stable and at a reasonable level, and that it passed $ 7 per dollar due to trade protectionism.
"The fear of a yuan depreciation and currency wars has risen again," which will only amplify the problem across broad financial markets, wrote Chris Weston, Pepperstone Group's head of research, in a note.
Ten-year government rates fell to trades are now priced at a more than 100% chance of the Federal Reserve reducing interest rates again in September, with US stocks opening after they recorded their worst week since Friday's sale in December. from July did little to change views on the economy and the path of interest rate policy.
The islands can now turn to any response from President Donald Trump to Monday's news on China's exchange rate, and he has recently criticized China for manipulating its currency Wall Street has also speculated on the potential for the Trump administration to intervene to tackle dollar gains, even though analysts have flagged a lot of challenges with such a step.
Elsewhere, oil fell to $ 55 per barrel amid escalating trade tensions. Goods came under renewed pressure, with iron ore futures in Singapore falling below $ 100 a tonne.
These are some important events to watch out for this week:
Financial Giants Revenue Includes: SoftBank, HSBC, UniCredit, AIG, ABN Amro Bank, Standard Bank, Japan Post Bank. Five Asian central banks have interest rate decisions including India, Australia and New Zealand. A string of Fed makers are talking this week. Governor Lael Brainard is up first on Monday, followed by St. Louis Chief James Bullard on Tuesday and Chicago's Charles Evans a day later. All are voters from the Federal Open Market Committee.
Here are the key features of the markets:
The Topix index fell 2.7% from 12:37 am. in Tokyo.Australia's S & P / ASX 200 index lost 1.4%. South Korea's Kospi index fell 2.3%. Hong Kong's Hang Seng index slipped 2.9%. Shanghai Composite Index fell 0.8%. S&P 500 futures fell 1.2%. The MSCI Asia Pacific Index lost 2.2%.
The Yen rose 0.7% to 105.89 per dollar. The yuan fell 1.4% offshore to $ 7,0778 per dollar. Euro was at $ 1.1125, up 0.1%.
The yield on 10-year government bonds fell by seven basis points to 1.77%.
Intermediate production in Texas, Texas, fell 1.1% to $ 55.07 a barrel. Gold rose 0.9% to $ 1,453.95 per gram.  To contact the reporter about this story: Andreea Papuc of Sydney at email@example.com
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