China allowed the tightly managed currency to climb to its highest point since July, after fixing the yuan’s trading-band midpoint at its firmest in more than five months. — Reuters pic
SINGAPORE, Jan 14 — Asian shares hit a 7-month high, China’s yuan jumped and safe-harbour assets slipped today, amid signs of goodwill between China and the United States, as the world’s two biggest economies prepared to sign a truce in their trade war.
The US Treasury Department yesterday said China should no longer be designated a currency manipulator — a label it applied as the yuan dropped in August.
China, meanwhile, allowed the tightly managed currency to climb to its highest point since July, after fixing the yuan’s trading-band midpoint at its firmest in more than five months.
The yuan sat 0.4 per cent firmer at 6.8677 per dollar by mid session.
The moves come as a Chinese delegation arrived in Washington ahead of tomorrow’s signing of the Phase 1 trade agreement, seen as calming a dispute that has upended the world economy.
MSCI’s broadest index of Asia-Pacific shares outside Japan hit its highest since June in morning trade, driving world stocks to a record high.
Japan’s Nikkei added 0.7 per cent and hit its highest point in a month. Hong Kong’s Hang Seng rose to its highest since May and Shanghai blue chips scaled heights not touched since January 2018, though both later pared gains.
Australia’s S&P/ASX 200 rose 0.7 per cent to a record intraday high. Gold fell and the safe-harbour Japanese yen dropped to a seven-month low.
“There have been a number of false starts,” said Vishnu Varathan, head of economics at Mizuho Bank in Singapore.
“The fact that this is really coming to the moment when the rubber hits the road is the most tangible