* reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=CNY=poll data
By Vivek Mishra
BENGALURU, Aug 14 (Reuters) - The Chinese yuan will weakenfurther beyond the current 7 per dollar rate over the comingyear as Beijing steps back from managing the currency amidtariff threats from Washington, a Reuters poll of foreignexchange strategists showed.
Having protected it since the global financial crisis,Chinese authorities let the yuan breach the key psychological 7per dollar rate last week.
That came after U.S. President Donald Trump imposed anadditional 10% tariff on the remaining $300 billion worth ofChinese imports and as Washington called China a currencymanipulator for the first time in 25 years.
Since then, China's central bank has consistently set theyuan's daily mid-point reference rate above 7 to the dollar,only allowing it to move in a 2% range, weakening the currencyto over an 11-year low of 7.0689 per dollar on Monday.
The poll, taken after those developments, predicted the yuanwould weaken about 1% to 7.10 per dollar byend-October. It is then forecast to gain slightly to 7.06 in ayear, close to where it was trading on Tuesday.
That is a complete U-turn in expectations from a surveytaken last week when the yuan was forecast to have risen over 2%in a year, with the most optimistic call pencilled in for an 11%gain.
"We think it is unlikely that the USD/CNY will fall below 7unless upcoming trade talks go particularly well, which is notour base case," said Iris Pang, Greater China economist at ING,who was second most accurate forecaster in Reuters polls forAsian currencies in 2018.
"The USD/CNY passing 7 shows that China is going to fightthis trade war hard, at least while President Trump is inoffice."
The year ahead outlook for the renminbi in the latest surveywas the most downbeat median in Reuters polls since June 2017.The most pessimistic forecast in the latest poll was 7.75 byRabobank, a rate not seen since early 2007.
"In an environment which is going to be globally far moreuncertain where China is growing much more slowly, you have morethan a trade war - basically a Cold War between the two. Itstrikes me that you will end up having a massive depreciation inthe renminbi," said Michael Every, Hong Kong-based seniorAsia-Pacific strategist at Rabobank.
"Fundamentally, I do not see any way that you are going toget a clear trade deal that would last between the U.S. andChina. We have got decades' and decades' worth of instability onthat front ahead of us."
Rabobank's Every forecasts the yuan to depreciate around20-25% to 8.5 or more against the greenback in the next twoyears.
A weaker yuan also raised risks of capital outflows,something China has been able to keep under control over thepast year.
Additionally, a weak economic growth outlook andexpectations of more policy easing by the People's Bank of Chinawill exert further pressure on the yuan.
"China has probably determined that striking a deal with theU.S. is unlikely and it is time to allow the renminbi to fall toreflect fundamentals (weaker growth) and to dig in for along-term stalemate," said Jason Daw, head of emerging marketsstrategy at Societe Generale, the most accurate forecaster forAsian currencies last year.
(Other stories from the global foreign exchange poll:)(Polling by Shaloo Shrivastava in Bengaluru and Jing Wang inShanghai; Editing by Sam Holmes)