Asian shares battered by China turbulence as trade war anxiety heightens

GETTYChina's yuan took a dive as Trump's trade war looms

The central bank put the midpoint roughly in line with market expectations at 6.6497 yuan per dollar, its weakest level in about 10 months, setting the stage for the day's drop.

Chinese currency and stock markets have been jittery ahead of a July 6 deadline for USA tariffs on $34 billion worth of Chinese goods that Beijing has said it would match with tariffs on US products. Beijing has recently started trading oil in yuan which is seen as an initial step to challenging the dominance of the United States dollar. It's lost about 4.6 percent of its value against the dollar since June 14.

"We will continue to implement a prudent and neutral monetary policy... and keep the yuan exchange rate basically stable at a reasonable and balanced level", he said.

There had also been reports of suspected intervention, with some major Chinese banks selling the dollar after the yuan slid past 6.70 per dollar in the swaps market.

The yuan advanced as much as 0.7% against the dollar shortly after trading began in mainland China on Wednesday.

The dollar retreated 0.4 percent against a basket of currencies and the easing tensions in Germany helped the euro to gain 0.2 percent against the greenback.

Chinese stocks went into a tail spin on Tuesday as turbulence gripped equity markets in Asia, which sank to nine-month lows amid heightened anxiety a bitter trade dispute between the United States and major economies could derail global growth.

Trump’s tweets have added $10 to oil prices, Iran’s OPEC boss says
Oil was trading at over $78 per barrel of the Brent benchmark on Thursday, while US West Texas Intermediate was trading at $74.55. President Donald Trump - facing high retail gasoline prices ahead of midterm elections - pushes Saudi Arabia to boost output.

Investors are awaiting the release of the Federal Reserve's June meeting minutes on Thursday and Friday's U.S.jobs data for validation of policymakers' forecasts for two more rate hikes this year.

Elsewhere the Australian dollar took heart from solid domestic retail sales data and edged up to $0.7403, moving away from an 18-month trough around $0.7311.

"Recently the foreign exchange market has shown some volatility and we're paying close attention to that", Yi said in a statement responding to a request by the China Securities Journal posted on the central bank's website. US crude fell 1.5 percent to $73.03 per barrel and Brent was last at $77.71, down 0.68 percent.

Oil prices climbed after Libya declared force majeure on some of its supplies, with Brent crude rising 0.8 percent to $77.93 per barrel and West Texas Intermediate (WTI) crude was up 1.1 percent to $74.77 a barrel.

Stock markets in Europe and the United States advanced on Thursday, offsetting more losses in Asia as investors were encouraged by economic data from Germany and a report that its big carmakers could be spared from US tariffs.

Obrador, who cruised to victory at the weekend as the first leftist elected president since one-party rule ended in 2000, has worked to dispel fears he might be averse to private investment when he takes office on December 1.

The peso firmed 2.6 percent overnight, by far the biggest gainer among Latin American currencies, as improved sentiment over Mexico helped to magnify an emerging markets rally.

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