• Details of dollar and a yuan notes are seen at a bank on May 15, 2006 in Beijing, China.

Details of dollar and a yuan notes are seen at a bank on May 15, 2006 in Beijing, China. (Photo : Getty Images)

China's recent moves helped the yuan rise both onshore and offshore. The surge sparked speculation that China wants to establish a firm grip on the currency ahead of Donald Trump's inauguration.

China has been busy with its onshore and offshore yuan markets to boost the faltering yuan for a second day. State banks sold dollars and borrowing rates for offshore component of the yuan, which resulted in a "stronger-than-expected" daily trading midpoint for the yuan. These hinted of a state intervention to stem losses in the currency.

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The moves resulted in the yuan rising by 0.1 amid the strength in the global dollar index.

Meanwhile, the offshore yuan hit a two-week high.

During the campaign period, Trump threatened to implement high tariffs on Chinese goods and label Beijing a currency manipulator. It would be no wonder why global investors are jittering over the yuan a few weeks into the U.S. president-elect's inauguration on Jan. 20.

"Trump's actual policy delivery and his stance against China are critical to the dollar and yuan direction in 2017," said Ken Cheung, Asian FX strategist at Mizuho Bank in Hong Kong.

With how things are going for the yuan, a trade war between the U.S. and China might be possible after Trump takes office.

Economist Saul Eslake estimates that Trump can impose as high as 45 percent of tariffs on Chinese exports to the U.S.

"All that is required under existing U.S. law for the administration to impose very high tariffs on imports from a particular currency is for the treasury to declare it a currency manipulator," said Eslake.

While the yuan enjoys the surge, the U.S. dollar suffered after its unimpressive labor data.

Just two weeks until Trump's term begins, China and the rest of the world are already preparing respectively for the unexpected things to come.