The
Chinese yuan dipped to a one-week low versus the U.S. dollar on Thursday after escalation
in the tensions between the U.S. and China that raised concerns about a renewed
war between the two gigantic economies.

The
onshore yuan was 0.03 percent down at 6.9968 per dollar, falling below the 7 level,
where it hit a bottom of 6.9646 on Wednesday, which was the lowest since March.

Earlier
today, the People’s Bank of China (PBOC) set the midpoint rate at 6.9921 per
dollar, compared to the previous fix of 6.9718. That was the lowest point in
nearly a month.

As
for the offshore yuan, it traded 0.3 percent down at 6.9966
per dollar
after it registered a low at 6.9947 per dollar.

Meanwhile,
eyes have returned again to the U.S.-Sino war with China, as President Trump
ordered to close his countries’ consulate in Houston amid accusations of spying.

Trump
also stressed that it was “always possible” other Chinese missions
could be ordered to close as well.

On
the other hand, markets are anticipating a similar action from Beijing, amidst
expectations that China would close its U.S. consulate in the central city of
Wuhan
.

Despite
the ongoing plunge in the U.S. dollar, the risk aversion by traders prompted them
to sell the yuan and hold the green currency.

The
woes of the Covid-19 spread continued to weigh on the market sentiment, as California
recorded the highest daily increase in new cases and total infections worldwide
surpassed 15 million.

American
politicians are still struggling to agree a new stimulus package
before
the expiry of the undergoing one.

The
dollar index extended its plummet for a fifth straight session to 94.71, a
level not seen since March this year.

China’s CSI 300 index
fell 2 percent at the beginning of the trading session before recovering some
of the losses to finish 0.043 percent down at 4,712.44.

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