Bitcoin Rises Minutes After China Announces Additional Tariffs on US

Story by: Davit Babayan

Bitcoin began an impressive price surge minutes after China announced that it would slap additional tariffs on US goods.

Beijing said late Friday that it would increase taxes on $70 billion worth of US imports of between 5 and 10 percent. That progressed its already worsening trade dispute with Washington which last week had announced a similar tariff on $300 billion of Chinese imports.

The BTC/USD instrument spiked by $355, or 3.52 percent, to establish a local high towards $10,449.52 on San Francisco-based Coinbase exchange. The move uphill appeared shortly after China’s announcement, validating bitcoin’s growing correlation with the global trade dispute. Investors/speculators evidently went bullish on the cryptocurrency’s near-term price prospects, a move similar to many ever since the US-China trade war picked momentum.

Renminbi Down

Sentiments towards the Chinese Renminbi dwindled on Friday, with analyst predicting the national currency would fall further due to the tariff announcement. As of 10:00 UTC, one dollar bought 7.079 yuan, the unit of the renminbi. Earlier, the price had dropped towards 7,099, a level never-touched-before since the financial crisis 11 years ago.

The People’s Bank of China allowed the renminbi to go down below 7 a dollar in early August, sparking a further escalation in their dispute with the US. The move prompted the White House to call China a “currency manipulator.”

Meanwhile, bitcoin encashed the most as two superpowers remained engaged in a tit-for-tat strategy. The cryptocurrency surged 5 percent on the day PBoC forced the renminbi lower. It is now eyeing to repeat the price action as investors look for safe-haven assets against the impending economic meltdown.