The US Treasury Department has designated China as its currency manipulator, and the US and China trade wars have worsened to the currency wars, raising the yuan's exchange rate against the dollar.

On Monday, the yuan exchange rate against the dollar in the offshore market in Hong Kong rose to 71,400 yuan, up 0.63 percent from the previous trading day.

This is the highest level since the Hong Kong offshore market opened in 2010.

A rise in the yuan's exchange rate against the dollar means that the value of the yuan has fallen as much.

As the news that the US has designated China as a currency manipulation country from early morning, the weakening of the yuan has appeared.

However, as the People's Bank of China announced plans to issue 30 billion yuan worth of Central Bank Securities, a currency-denominated bond in Hong Kong, just before the opening of the market in the region, the downturn in the yuan has been somewhat calmed down.

At 9:40 am (local time), the yuan exchange rate against the dollar in the offshore market and the intra-regional market is being set at 7.09 yuan and 7.05 yuan, respectively.

Earlier, the People's Bank of China (PRC) announced a median exchange rate of 6.9225 yuan per dollar, up 0.66 percent from the previous day.

The US Treasury Department has designated China as a currency manipulation bureau after the yuan exchange rate against the US dollar for five days exceeded 7 yuan in 11 years since May 2008.

The two nations are expected to play a fierce battle over the proper yuan exchange rate.

US President Donald Trump said on the morning of May 5, "China has reduced its currency value to almost the lowest level in history," he said. "It is called exchange rate manipulation."