China's currency and the U.S. stock market stabilized Tuesday, after a dramatic drop the day before. Experts say the Trump administration was wrong to accuse China of currency manipulation.
World stock markets saw sharp sell-offs after China let its currency slide, the latest move in its trade war with the United States. The Dow Jones Industrial Average closed down 767 points, or 2.9%.
China's central bank appears to have orchestrated the yuan's fall against the U.S. dollar. A weaker currency makes Chinese goods more competitive on the world market.
U.S. trade negotiators are heading to Shanghai for talks with their Chinese counterparts this week, but there appears to be little pressure for a settlement in the year-old conflict.
President Trump is due to meet with Chinese leader Xi Jinping this weekend, raising hopes the two leaders might call a truce in their trade war. The White House has downplayed expectations of a deal.
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