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market | IST

Global stocks deepen losses as US brands China currency manipulator

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Japan's Nikkei shed 2.8 percent, Australian stocks fell 1.8 percent and South Korea's KOSPI percent slid 2.5 percent.

Global stocks extended their already substantial losses and the offshore yuan hit an all-time low on Tuesday after Washington designated Beijing a currency manipulator in a rapid escalation of the US-China trade war. The US Treasury Secretary Steven Mnuchin said on Monday the government had determined that China is manipulating its currency, and that Washington would engage with the International Monetary Fund to eliminate unfair competition from Beijing.
The Trump administration's dramatic move against China hastened the risk aversion seen in global markets this week. On Monday, China let the yuan slide in response to the latest US tariff, which is expected to further aggravate trade tensions between the world's two largest economies.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.75 percent to its lowest since January. Japan's Nikkei shed 2.8 percent, Australian stocks fell 1.8 percent and South Korea's KOSPI percent slid 2.5 percent.
S&P 500 futures fell 1.3 percent in early Asian trade. Wall Street's major indexes already posted their biggest percentage drop of the year on Monday on fears of escalation in the US-China trade war.
MSCI's All Country World Index, which tracks shares in 47 countries, extended last week's slide and has slumped 2.5 percent to a two-month low on Monday.
China's offshore yuan stretched the previous day's big slide and weakened to 7.1288, a fresh record low since international trading on the Chinese trade began.
The yen, a perceived safe-haven in times of market turmoil and political tensions, rose 0.4 percent to a seven-month high of 105.520.
Investor demand for other safe-havens such government bonds also remained high as risk aversion gathered momentum.
The 10-year US Treasury yield extended sharp falls overnight and declined to 1.685 percent, its lowest since October 2016.