China lets currency weaken below key level amid growing trade war with U.S.

(Image credit: GREG BAKER/AFP/Getty Images)

China's central bank, the People's Bank of China, allowed the yuan to breach the psychologically important rate of 7 to the U.S. dollar on Monday, pushing the Chinese currency to its weakest level in a decade, The New York Times reports. The People's Bank of China, which tightly controls the value of the yuan (or renminbi), cited "unilateralism and trade protectionism measures and the imposition of increased tariffs on China," but said currencies fluctuate and the renminbi is stable.

Worries about the ongoing U.S.-China trade war sent U.S. stock futures plunging early Monday morning. Futures for the Dow Jones Industrial Average dropped more than 300 points, or 1.2 percent, MarketWatch reports. Futures for the Nasdaq and S&P 500 were down 1.7 percent and 1.3 percent, respectively. Last week, President Trump surprised Wall Street by announcing additional 10 percent tariffs on $300 billion of Chinese goods, set to take effect in September.

China's currency news is "fueling concern Beijing might use its currency as a weapon in the tariff war," Fox Business reports.

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.