Dollar heads towards 1-week lows as trade U.S.-China talks get underway

Thursday,   10-Oct-2019   03:00 PM (IST)

The dollar weakened broadly against its rivals on Thursday as the progress of trade negotiations between the United States and China kept markets on edge with the prospects of a partial deal fuelling appetite for trade-oriented currencies. The Australian and New Zealand dollars led gains against the greenback after Bloomberg reported the United States is weighing a currency pact with China which could see a planned tariff hike next week being suspended. With negotiations between Beijing and Washington getting underway on Thursday, market watchers say any concessions from China would be touted as a success from U.S. officials and that might fuel further yen weakness and gains in the Aussie dollar. A currency pact would pave the way for further negotiations on core issues such as intellectual property and forced technology transfers with reports that Beijing has offered to increase purchases of agricultural goods further signaling a thaw in trade tensions. Against a basket of its rivals, the dollar weakened 0.3% to 98.845, nearing a one-week low. It weakened as much as 0.4% versus the New Zealand and Australian dollars. The Chinese currency in the offshore market gained for a second day, rising 0.3% versus the greenback to 7.1145 yuan per dollar. The pound climbed 0.3% to $1.2241, though it remained close to a one-month low amid uncertainty over Britain’s exit from the European Union before a slew of British data.