Aussie Dollar Up, Yen Down as Trump Delays China Tariff Hike
Australian Dollar, New Zealand Dollar, Japanese Yen, US Tariff Hike Delay - Talking Points:
- ‘Risk currencies’ got a lift on some upbeat trade Tweeting from the US President
- The feared US tariff hike penciled in for March 31 seems to have been eliminated
- Donald Trump said that progress had been made and offered the prospect of a summit
First-quarter technical and fundamental forecasts from the DailyFX analysts are out now.
The Australian and New Zealand Dollars made early gains Monday, while the haven Japanese Yen lost ground on news of apparent progress in trade talks between China and the US.
US President Donald Trump said via his Twitter feed that he would be delaying the tariff increase initially planned for March 31 thanks to ‘very productive’ trade talks between the two countries. According to wire reports he also said that a summit with his Chinese counterpart Xi Jinping could be on the cards if more progress is made. There have been positive steps on intellectual property, technology, agriculture and currency policy, the US President said.
With so many global economic indicators looking patchy at best, a trade fillip from this direction couldn’t be better timed. Trade snarl-ups rippling out from the US/China impasse have hit countries well beyond the two main players.
Growth sensitive currencies got a clear immediate boost, with perceived havens such as the Japanese Yen put under pressure.
AUD/USD provides a good example of the general trend, gapping higher on the news.
Markets will now await further details, with trade headlines likely to retain the ability to override all other concerns as this week’s trading progresses.
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--- Written by David Cottle, DailyFX Research
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.