- The dollar accelerates its reversal with investors becoming cautious before commercial negotiations between the US and China.
- The operators are now looking beyond the solid report of non -agricultural payrolls from the US seen on Friday.
- The president of the USA, Trump, said this weekend that the negotiations will go “very well.”
The dollar presents the weakest yield of the G8 currencies on Monday, since investors changed their approach to the optimist report of non -agricultural payrolls of US to the commercial negotiations between the US and China, which will be carried out later today in London.
The USD index (DXY), which measures the value of the dollar against the six most negotiated currencies in the world, is accelerating its reversal from the maximum after NFPs, at 99.35 on Friday, back to levels below 99.00.
The result of the conversations between the US and China will drive the USD today
Investors are reducing their long bets in the US dollar on Monday, in a cautious position before a meeting between representatives of China and the USA, who will try to put aside their commercial differences and revive the spirit that led to a reduction of their reciprocal tariffs after the conversations of last month in Geneva.
A telephone call between the US president, Donald Trump, and his Chinese counterpart, Xi Jinping, last week he relieved some of the previous tensions and has improved expectations about today’s meeting. Trump has contributed to market optimism with a tweet during the weekend showing his confidence that the negotiations will “very well.”
The calendar is scarce on Monday, and the effect of the strongest payroll data than the expected of the US of Friday is decreasing. The Fed is in its period of silence, before the next week, which will probably be an event without relevance, since Friday’s employment report has practically confirmed that the bank will maintain interest rates without changes, at least until September.
Commercial War between the US and China Faqs
In general terms, “Trade War” is a commercial war, an economic conflict between two or more countries due to the extreme protectionism of one of the parties. It implies the creation of commercial barriers, such as tariffs, which are in counterbarreras, increasing import costs and, therefore, the cost of life.
An economic conflict between the United States (USA) and China began in early 2018, when President Donald Trump established commercial barriers against China, claiming unfair commercial practices and theft of intellectual property by the Asian giant. China took retaliation measures, imposing tariffs on multiple American products, such as cars and soybeans. The tensions climbed until the two countries signed the Phase one trade agreement between the US and China in January 2020. The agreement required structural reforms and other changes in China’s economic and commercial regime and intended to restore stability and confidence between the two nations. Coronavirus pandemia diverted the attention of the conflict. However, it is worth mentioning that President Joe Biden, who took office after Trump, kept the tariffs and even added some additional encumbrances.
Donald Trump’s return to the White House as the 47th US president has unleashed a new wave of tensions between the two countries. During the 2024 election campaign, Trump promised to impose 60% tariff particularly in investment, and directly feeding the inflation of the consumer price index.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
