Increased fears of a US-China trade war together with a rise in the pound and the euro led the dollar to fall against its major rivals in Monday’s trading session. The dollar index, which tracks the performance of the greenback versus six major currencies, fell 0.47% to trade at 94.08 points.<\/p>\n
Although the US administration’s decision to reduce tariffs on Chinese goods exported to the US has eased concern in the markets from the thought of a full blown trade war, US President Donald Trump has announced new 10% tariffs on Chinese goods worth 200 billion dollars this week.<\/p>\n
According to the Wall Street Journal, the new 10% tariff on goods worth 200 billion is less than the original 25% figure requested by the US administration in the previous period. The new tariffs come just one week before a new session of trade talks between China and the US. China has vowed to reciprocate countermeasures if the United States does not change its decision to impose customs duties on Chinese goods.<\/p>\n
Among the most important currency pairs outside of the JPY and the US dollar, the Australian dollar was the most affected by the trade tensions between China and the United States. AUD\/JPY rose 0.37% and the pair traded at 80.45. This is primarily due to the fact that the Australian economy relies on the export of primary raw materials, especially minerals, to China. Australian exports to China make up about one third of Australian exports each year.<\/p>\n
The US dollar also fell 0.08% against the Japanese yen, which is a safe haven for investors in times of trade tensions and market uncertainty, with the USD \/ JPY pair falling to 111.96 yen per dollar.<\/p>\n
Market tensions risen after the US president threatened with further tariffs on US trading partners, similar to what happened with China if no \u201cfair deals\u201d were reached.<\/p>\n
The pound rose against the US dollar after the release of optimistic Brexit reports, which caused a wave of optimism in the markets. Before the start of the new Brexit talks on Wednesday, the EU Council noted that some parts of the Brexit contract have been agreed in principle. The GBP \/ USD pair was up 0.61% at $1.3148 on Monday.<\/p>\n
In the Eurozone, consumer inflation and optimism signs from Italy helped the EUR \/ USD rally 0.58% to trade at $1.1690 per EUR.<\/p>\n
The USD \/ CAD dropped 0.09% as investors continued to hope the US and Canada would reach agreement on a deal to renew the North American Free Trade Agreement earlier this week.<\/p>\n","protected":false},"excerpt":{"rendered":"
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