Chinese Yuan Weakens Against the US Dollar in Reaction to Recent Legislation on Hong Kong
Early on Wednesday, the Chinese yuan has weakened against the US dollar as the spotlight goes back on the possibility of the US-China trade war intensifying again. At the time of writing, USD/CNH is trading around 7.109.
The Chinese government is threatening countermeasures in response to a recent US legislation in support of Hong Kong protesters. The US House of Representatives passed the “Hong Kong Human Rights and Democracy Act” on Tuesday, to explore whether various government departments are interested in changing the special trading status accorded to Hong Kong in light of the recent protests raging on.
Earlier today, a spokesman from China’s Foreign Ministry reacted to this development by stating, “If the relevant bill is finally passed into law, not only will it hurt Chinese interests and China-U.S. relations, but also seriously damage U.S. interests”. This latest development has markets concerned of a possibility of derailment of progress in recent US-China trade negotiations.
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