The value of the renminbi fell further following an intense selling spree on Thursday, bringing the currency just shy of what is deemed a psychologically important level against the US dollar.
In offshore trading, the renminbi fell to a low of Rmb 6.9667 against the US dollar after losing 0.33%. In onshore trading hubs, the currency slid to Rmb 6.9515, according to the Financial Times.
It is widely assumed that if the currency fall below Rmb 7 to the dollar, it will be a significant signal of both the depth of negative sentiment in the market. and the government’s attitude towards controlling its currency.
Analysts are already scanning for hints that China’s central bank is working over-time to prop up the value of the renminbi. For instance, onshore yuan-dollar exchanges totalled $66.3 billion on Wednesday, even more than previous highs, such was when China sought to overturn a devaluation in August 2015.