Yuan soars, stocks scale heights as markets cheer imminent Sino-U.S. deal signing

SINGAPORE (Reuters) – Asian shares hit a 7-month high, China’s yuan jumped and safe-harbor assets slipped on Tuesday, amid signs of goodwill between China and the United States, as the world’s two biggest economies prepared to sign a truce in their trade war.

An investor uses his mobile phone in front of a stock quotation board at a brokerage office in Beijing, China January 3, 2020. REUTERS/Jason Lee

The U.S. Treasury Department on Monday said China should no longer be designated a currency manipulator – a label it applied as the yuan dropped in August.

China, meanwhile, allowed the tightly managed currency to climb to its highest point since July, after fixing the yuan’s trading-band midpoint at its firmest in more than five months.

The yuan sat 0.4% firmer at 6.8677 per dollar by mid session.

The moves come as a Chinese delegation arrived in Washington ahead of Wednesday’s signing of the Phase 1 trade agreement, seen as calming a dispute that has upended the world economy.

MSCI’s broadest index of Asia-Pacific shares outside Japan hit its highest since June in morning trade, driving world stocks to a record high.

Japan’s Nikkei added 0.7% and hit its highest point in a month. Hong Kong’s Hang Seng rose to its highest since May and Shanghai blue chips scaled heights not touched since January 2018, though both later pared gains.

Australia’s S&P/ASX 200 rose 0.7% to a record intraday high. Gold fell and the safe-harbor Japanese yen dropped to a seven-month low.

“There have been a number of false starts,” said Vishnu Varathan,

Keep reading this article on Reuters Business.

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