China devalues yuan against dollar, hits stocks

People's Bank of China makes largest reduction in value of renminbi against dollar ever

China devalues yuan against dollar, hits stocks

World Bulletin / News Desk

The People's Bank of China on Tuesday reduced the value of the country's currency, the renminbi, against the dollar by 1.9 percent, to 6.228.

It stands as the largest reduction in value made by the Chinese national bank against the dollar peg ever.

Currency markets reacted sharply to the move. The euro dropped to about 1.09 against the dollar, from about 1.11. The Australian dollar lost 1.1 percent, falling to $0.732.

In a statement on Tuesday, the People's Bank ofChina said it was "reacting to market trends". Growth in China has slowed this year. 

Economists saw the move as a preparatory step, intended to favor the inclusion of the renminbi in the International Monetary Fund's Special Drawing Rights currency. The IMF is to make a decision on the renminbi inclusion in September.

The People's Bank of China fixes the value of the renminbi every day.

Güncelleme Tarihi: 11 Ağustos 2015, 10:30