July 4, 2018 / 2:20 AM / 12 days ago

China's yuan gains ground after PBOC tries to soothe markets

SHANGHAI, July 4 (Reuters) - China’s yuan rose sharply against the dollar on Wednesday and stocks flip-flopped a day after the People’s Bank of China governor assured markets the central bank would keep the currency stable.

The yuan tumbled in June, losing more than 3 percent of its value against the greenback, and the slide continued on Monday, the first trading day of July.

Chinese currency and equity markets have been on edge ahead of July 6, when U.S. tariffs on $34 billion worth of Chinese goods kick in. Beijing has said it would retaliate with tariffs on U.S. products.

But on Tuesday, it rebounded after PBOC Governor Yi Gang’s remarks and continued to ride the updraft on Wednesday, putting it on track for its first two-day winning streak since the middle of June.

At 0200 GMT, it was trading at 6.6242 yuan per dollar, 0.3 percent stronger than the late night close on Tuesday.

In equities markets, the benchmark CSI300 Index and the Shanghai Composite Index were both down about 0.3 percent. Both have moved into and out of positive territory.

Reporting by Winni Zhou and John Ruwitch; Editing by Sam Holmes

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