The offshore Chinese yuan slipped 0.5 percent, giving back some of the sharp gains made last week, when it gained about 1.8 percent in a record weekly rise. The onshore yuan was steady on the day. The spurt in CNH last week was driven predominantly by a jump in yuan borrowing costs offshore and tighter liquidity, which helped trigger the unwinding of bullish bets on the dollar. "Despite some semblance of order emerging, we should expect volatility to remain high," Stephen Innes, senior trader for FX broker OANDA said in a note. "I also expect that the underlying yuan depreciation pressures should return as fundamental reasons that are driving depreciation, such as capital outflows and concerns on Trump's China policies...haven't changed," Innes wrote. Emerging Asian currencies have retreated broadly over the past couple of months as U.S. bond yields jumped on expectations that President-elect Donald Trump's proposals for infrastructure spending and tax cuts will boost U.S. economic growth and inflation. Worries about Trump's stance on trade have also weighed on Asian currencies. Trump has vowed to label China a currency manipulator on his first day in office, and has threatened to slap huge tariffs on imports of Chinese goods. REUTERS
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