China let the yuan weaken past the key 7-per-dollar level on Monday for the first time in more than a decade and later said it would stop buying US agricultural products, inflaming a worsening trade war with the United States.
Asian factory activity contracted further in July, fuelling worries that a Sino-U.S.trade war and a slowdown in China could tilt the world towards a global recession, which central banks will have to fight with depleted ammunition.
Asian markets slipped on Monday as data showed China’s economy growing at its weakest pace in nearly three decades, hit by the US trade war, while investors debate the depth of an expected Federal Reserve interest rate cut.
China will soften or lift restrictions on foreign investment in new sectors from July 30, authorities announced Sunday, after Beijing and Washington decided to restart negotiations in their trade war.
China on Saturday increased tariffs on billions worth of US goods as it prepares to unveil a blacklist of “unreliable” foreign companies that analysts say aims to punish US and foreign firms cutting off supplies to telecoms giant Huawei.