Forex - U.S. Dollar Unmoved by Sino-U.S. Phase One Deal Signing


The U.S. dollar was largely unchanged on Thursday in Asia following the conclusion of much-awaited Sino-U.S. one trade deal.

The U.S. and China completed the signing of the partial trade agreement at the White House overnight, putting the trade war between the two sides on a pause.

U.S. Vice President Mike Pence said further phase two talks had already begun as negotiators work to resolve differences.

Under the terms of the first deal, the U.S. reduced tariffs on $120 billion in Chinese goods to 7.5% from 15%. In exchange, China agreed to increase purchases in the U.S. by $200 billion over the next two years in manufactured goods, agriculture, energy and services.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies was largely unmoved following the news, as the deal was already largely priced into the markets.

The index last traded at 96.959, down 0.01%.

Earlier in the day, the index fell after data showed inflation in the U.S. remained muted.

The Labor Department said its producer price index, which measures prices that businesses receive for their goods and services, slowed to a pace of 0.1%, below economists' forecasts for 0.2% rise. In the 12 months through November, the PPI rose 1.3%, in line with forecasts of 1.2%.

Meanwhile, the GBP/USD pair inched up 0.1% to 1.3047, lifted by comments from Prime Minister Boris Johnson who said late Tuesday that he considers “very likely” the U.K. will get a “comprehensive trade deal with the EU by year-end.”

In a speech earlier, Bank of England policymaker Michael Saunders repeated his support for a rate cut to support an economy weakened by Brexit and other uncertainties.

The AUD/USD pair and the NZD/USD pair rose 0.1% and 0.3% respectively.

Source: https://www.investing.com/