Major currencies hold its ground as traders await U.S-China trade outcome
Major currencies hardly budged on Wednesday as traders waited for the final outcome of the U.S.-China trade talks.
Against the Yen, the Dollar was traded for 109.05 Yen which was off two-week high of the 109.205 it touched on Tuesday as mild optimism that Washington and Beijing could soon sign a deal to put a hold on their 16-month trade spat.
The Euro also had little changed, standing at $1.1023. Trade is slowing down ahead of the Thanksgiving holiday on Thursday in the U.S., before which some major players will have wind down most of their trade for the year.
U.S. President Donald Trump said on Tuesday Washington was in the “final throes” of work on a deal that would defuse a 16-month trade war with Beijing.
“Judging from Trump’s comments, an agreement will have to wait at least until the weekend,” said Kyosuke Suzuki, director of forex at Societe Generale in Tokyo.
“I think markets are betting that a likely compromise will be to continue to negotiate on tariffs. If that turns out to be the case, we could see buy-on-rumor-sell-on-fact type of selling in the dollar/yen,” he added.
If both sides cannot reach an agreement soon, the next date traders look forward to would be December 15, when Washington is scheduled to impose even more tariffs on Chinese goods.
However, Minori Uchida, chief currency analyst at MUFG Bank said that the market believes that the December tariffs would not be activated.