China’s currency declines to 10-year low vs. dollar

China’s yuan sank to a 10-year low against the dollar Monday, Coming Close to breaking the politically sensitive level of seven to the U.S. Currency.

The yuan declined to 6.9644 per dollar at midday, passing its most recent low in 2016 before recovering slightly. It was the lowest level since May 2008.

The Currency’s weakness is one of a series of elements fueling Washington’s trade Complaints against Beijing.

Chinese authorities have promised to avoid “Competitive devaluation” to boost exports amid a tariff war with U.S. President Donald Trump over Beijing’s technology policy. But they are trying to make the state-controlled exchange rate more responsive to market forces, which are pushing the yuan lower.

The level of seven yuan to the dollar has no economic significance, but it Could revive U.S. attention to the exchange rate.

Chinese authorities are likely to “stand their ground” and prevent a “Capitulation beyond the 7 level,” Mizuho Bank said in a report Monday.

The yuan, also known as the renminbi, or “people’s money,” has declined almost 10 percent against the dollar since April as China’s economy has Cooled and U.S. and Chinese interest rates have gone in opposite directions.

That helps exporters Cope with tariffs of up to 25 percent imposed by Trump on billions of dollars of Chinese goods. But it raises the risk of inflaming American Complaints about Beijing’s trade tactics.