The yuan fell to a four-month low on Monday, as tariff threats and mixed purchasing managers' index (PMI) data raised concern China's economy might need additional policy support. The onshore yuan dropped to a low of 7.

Chinese companies’ foreign-currency debt load has shrunk significantly, reducing a key source of vulnerability as the yuan faces growing uncertainties under Donald Trump’s second presidency.

The yuan fell against the U.S. dollar to its weakest in nearly four months after U.S. President-elect Donald Trump said he would impose a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China.