The USD was the main beneficiary of the decision by the US to delay additional tariffs on some Chinese imports until December 15. The announcement moved the Dow over 400 points higher before finishing on the day up 372 points. President Trump said he delayed the tariffs ahead of the Christmas season to avoid a potential impact on holiday shopping.
EUR is trading quietly after Germany’s GDP at 0.2% revealed economic contraction during the second quarter. Fears that the Eurozone economy is headed for recession continue to grow, while EUR also moved lower as markets reacted to the tariff announcement.
Brexit concerns remain high as members of the House of Commons are concerned with Prime Minister Boris Johnson’s determined move towards a no-deal Brexit. This is seen to be holding GBP back despite good inflation numbers. This looks to be the general theme as we move towards the Oct. 31 exit date.
Traders moved away from JPY after the tariff announcement. The move was strong as USD/JPY recovered by almost 2%. Any reversal of yesterday’s comments could see traders return to the Yen but for now it looks docile.
Loonie moves higher as surging crude oil prices help commodity based currencies. Better trade news out of the US could help the CAD as well, but traders are likely to be focusing on oil prices in the next few trading sessions.
The People’s Bank of China fixed the CNY at 7.0312, which was stronger than analysts expected. According to Reuters, analysts had predicted a fixing of 7.0502. This is the 5th consecutive trading session that the Yuan has been fixed above the 7.0000 level.