Market tension: China has devalued the yuan to its minimum since 2008

Four days after US President Donald Trump announced new tariffs on Chinese products, the currency of the country, the yuan, broke the psychological barrier of 7 units for every dollar, which had not happened since April 2008..

Analysts point out that the People's Bank of China (PCB, central) has consciously dropped the value of the currency, while the institution says it is the fault of the market.

Beijing had promised "retaliation" after Trump announced that it would charge 10% duty on Chinese goods worth $ 300 billion as of September 1.

According to Yicai financial information portal, each dollar was traded for 7.0258 yuan according to the "onshore" rate – the one operated in local markets – after 10:00 am local time (02:00 GMT) after rising 1.23 % of operations in the morning, which represents the highest quota since April 2008.

The fact that the "onshore" rate is rising is a sign of weakening of the renminbi (official name of the currency), because the purchase of dollars by the yuan holders costs more.

At the same time, the "offshore" rate – the one applied on international markets such as Hong Kong – has risen by 1.38% and is set at 7,0683 yuan for one dollar.

It was the first time that the yuan had risen more than 7 against the dollar, considered by many badysts as a psychological barrier for investors since the opening of the offshore market in Hong Kong in 2010.

Markets are suffering

The event caused a general fall in global stock markets and a race for safer badets, such as the Japanese yen, US Treasury bonds and other countries and the gold.

In Europe, the Stoxx 600 index lost 1.59% after closing Friday at 2.5%, its worst level in two months. The British stock market led the fall with losses of 1.74%, followed by France (-1.73%) and Germany (-1.28%)

While in Asia, the MSCI regional index, which counts companies out of Japan, has collapsed to 2.5%, the worst performance in 10 months. Hong Kong Hang Seng led with a fall of 2.85%, followed by Shanghai (-1.6%).