China Considers Currency Strategy Amid Trade Tariffs Pressure

The yuan and other Asian currencies fell after reports that China may allow its currency to weaken next year in response to heightened tariffs. This decision comes as key policymakers anticipate challenges under a potential second term for Donald Trump in the U.S.

The yuan took a hit along with various Asian currencies after Reuters revealed China's potential plan to weaken its currency next year in anticipation of greater tariffs.

The Chinese currency dropped by roughly 0.3% to 7.2803 per dollar, affecting the Korean won and the China-sensitive Australian and New Zealand dollars. The Australian dollar even hit a one-year low of $0.6341.

Insight from sources familiar with the situation disclosed that China's top officials might authorize a softer yuan as they prepare for possible increases in trade tariffs under a resumed presidency of Donald Trump in the U.S.

(With inputs from agencies.)