USD Edges Lower as Traders Turn Attention to China Trade Talks
USD talking points:
- With the Federal Reserve meeting now out of the way, the markets’ focus is turning to the US/China trade negotiations.
- That has left the US Dollar marginally lower, although it remains in a strong uptrend.
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US/China trade talks in focus
The US Dollar remains in the spotlight Thursday after Wednesday’s mildly hawkish statement from the Federal Reserve, which made a US rate increase almost certain in June, followed by several more over the course of 2018.
This session looks set to be dominated by start of US/China trade talks, which are expected to be difficult and could lead to further mild losses for USD after its recent strong performance.
US Dollar Basket Price Chart, Daily Timeframe (2018 to Date)
A US trade delegation arrived in Beijing Thursday for a two-day meeting but hopes are low that a deal on tariffs can be reached near-term. If the talks break down completely, as seems possible, that will likely lead to further losses for USD. However, as the chart above shows, the currency remains in a strong uptrend and any setbacks from here are likely to be modest and purely corrective in nature.
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--- Written by Martin Essex, Analyst and Editor
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.