China's onshore and offshore yuan both trimmed sharp declines against the dollar on Monday afternoon as comments by US President Donald Trump raised hopes for a de-escalation in the US-China trade war.

Trump said China had contacted US trade officials overnight to say they wanted to return to the negotiating table. And he hailed Chinese President Xi Jinping as a great leader and said he welcomed his desire for a deal and for calm.

Markets took his comments as a positive sign for chances for de-escalation after both sides announced additional tariffs on each other's goods over the weekend.

Onshore spot yuan bounced to 7.1395 per dollar before trading at 7.1421 as of 0721 GMT. Its offshore counterpart rose to 7.1497 before trading at 7.1545 as of 0721 GMT.

Earlier in the session, Chinese Vice Premier Liu He said that China is willing to resolve its trade dispute with the United States through "calm" negotiations and resolutely opposes the escalation of the conflict.