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Japanese yen strengthens vs. greenback amid trade clashes between China and America
On Wednesday, the evergreen buck dived versus the Japanese major currency amid a trade conflict between the United States and China, which could potentially damage the global economy. In addition, the Australian dollar tacked on in the morning trading due to strong retail sales.
The dollar index, which reflects the actual strength of the US dollar against a pack of the six major currencies, accounted for 89.76, which corresponds to a decrease of about 0.10%. It headed south from a night maximum of 89.92 and tumbled below 89.80.
Tensions increased after the USA proposed to introduce 25% tariffs on Chinese products worth about $ 50 billion. The fees will affect up to 1,300 items, including industrial technologies, transport and drugs.
More evident drivers for the US currency this week will be data on the dynamics of wages as well as comments by the head of the Fed Chair, Jerome Powell.
The People's Bank of China set a fixed rate of the Yuan against the evergreen buck at 6.2926 against 6.2833 yesterday. The currency pair USD/CNY inched up 0.06% offering a reading of 6.2931.
The Chinese embassy in Washington revealed in a statement that the Chinese side is geared up to resorting to the WTO dispute settlement mechanism and take appropriate measures against US goods in accordance with Chinese law.
The currency pair USD/JPY headed south 0.10% hitting 106.50. In times of economic uncertainty, the status of safe haven harbor naturally attracts buyers of the Japanese currency. On the other hand, the Japanese yen has always weakened amid the growing interest of investors in risky assets.
The currency pair AUD/USD tacked on 0.29% hitting 0.7707. On Wednesday morning, the Australian currency strengthened on February’s retail sales, which turned out to be better than anticipated.
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