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Seven renminbi to the dollar was regarded as a line in the sand for the Chinese central bank. But on Monday, the Chinese currency finally broke through its widely recognised line of defence - the first time it's done so since the global financial crisis.
But it was a level that was becoming harder to justify from China's perspective after Donald Trump's threat of more tariffs on Thursday last week. That threat led to a drop of nearly 1 per cent in the renminbi on Friday, as well as the sell-off in global equities as investors took fright.
China's commerce ministry vowed to retaliate. And while the People's Bank of China blamed the fall in the renminbi on trade protectionism and tariffs, letting its currency fall to more than seven to the dollar could be seen as part of its defence. Propping up China's currency can be an expensive business.
When China tried to defend the currency in 2016, it ended up burning through a large chunk of its foreign currency reserves, spending as much as $100bn in a single month. That was after a renminbi devaluation in 2015 that may have provided a short-term boost to the economy but led to significant capital outflows and drew the ire of critics in Washington who accused China of currency manipulation.
But on Monday, China's central bank tried to calm fears of runaway depreciation, claiming it has the experience, confidence, and capacity to keep the exchange rate fundamentally stable. However, the unpredictability of the Trump White House makes the next step in the trade war extremely difficult to predict.