Greenback’s relief rally from US-China tariff truce is but a brief blip: analysts
Will forex traders prioritise trade-deal breakthroughs, the slew of US data to be released, signs of fading American exceptionalism or the nation’s uncertain fiscal future?
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[SINGAPORE] Traders rewarded the US dollar with gains against major Asian currencies after trade tensions between Beijing and Washington thawed – but the greenback could soon be singing the blues again as analysts expect the relief rally to be short-lived.
The US dollar index – which measures the greenback’s value against a basket of six major currencies: the euro, yen, pound, Canadian dollar, krona and franc – jumped more than 1 per cent on Monday (May 12) afternoon, and then stabilised at around 101.6 as at early evening on Tuesday.
The US shaved its earlier tariff of 145 per cent on Chinese goods to 30 per cent on Monday, after a temporary deal for 90 days was brokered during weekend trade talks in Geneva. Further negotiations are expected to follow.
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