SHANGHAI: China’s yuan traded offshore weakened to 7 per dollar in European hours on Thursday, as markets continue to test authorities’ willingness to defend the symbolic level. The yuan or renminbi (RMB) has been struggling, like most currencies in the face of a strengthening dollar. Korea’s won and Japan’s yen have also been under significant pressure.

The RMB has not been helped by fears about the health of China’s economy, and while it has remained largely stable against most peers, market participants had thought Chinese authorities were loath to see it weaken past 7 yuan per dollar.

The dollar reached as high as 7.0188 yuan in offshore trade, its highest since July 2020, and was last up 0.35% at 6.9995.

The onshore unit also fell, but stayed on the stronger side of 7 at 6.9998 per dollar.

The onshore spot yuan can trade in a 2% range around the midpoint set by the People’s Bank of China in the daily fix.