Traders grew optimistic ahead of Trump trade speech, where he is expected to postpone imposing tariffs on EU autos.
Trump’s speech to the Economic Club of New York is expected to be market moving as he will discuss U.S. trade policy. Currency traders will be listening for hints about the Trump administration’s long-running trade war with China. The markets are likely to hang on every word about any progress toward the “phase one” trade deal.
Trump is widely expected to delay his decision to impose tariffs on European car and auto part imports.
The U.S. president said on Saturday that talks with China were moving along “very nicely” but the United States would make a deal only if it was the right one. He said there had been incorrect reporting about U.S. willingness to lift tariffs.
Trump said in the spring that imports of autos and auto parts were a threat to national security. This led him to instruct U.S. Trade Representative to negotiate deals with both the European Union and Japan. Trump’s instructions were to address the impairment and report back to him within 180 days on the progress. That deadline is on Wednesday.
START TRADINGForex – Trump trade speech and auto tariffs
The dollar was stronger against the yen and Swiss franc on Tuesday as traders grew optimistic ahead of Trump trade speech. It was up 0.1% against both the Japanese yen and 0.3% versus Swiss franc in early London trading. Versus a basket of currencies, the global dollar index rose 0.2%.
The euro hit four-week lows against the dollar, down as much as 0.2% at $1.10110.
The New Zealand dollar was down 0.5% at 0.6334 versus the U.S. dollar. It barely recovered from the low of $0.6323 it reached last week after a central bank survey. Such data showed the country’s near-term inflation expectations dropped, increasing traders’ expectations of a rate cut this week.
The Sterling inched down from six-month highs against the euro and was a touch softer against the dollar on Tuesday. A boost from the Brexit Party’s decision to not contest previously Conservative-held seats in Britain’s upcoming election faded. The pound was down 0.15% at $1.2832, having flirted with $1.29 on Monday.
Against the euro, sterling was a touch softer on the day at around 85.91 pence. The British currency was down around a third of a percent from Monday’s six-month peak of 85.62 pence.
Oil prices rose further above $62 a barrel, supported by hopes that U.S. President may signal progress on trade talks. Brent crude, the global benchmark, was up 29 cents at $62.47 a barrel by 1300 GMT, after falling as low as $61.90. West Texas Intermediate (WTI) crude rose 27 cents to $57.13.
Gold edged down on Tuesday, ahead of U.S. President Donald Trump’s speech at the Economic Club of New York. Spot gold fell 0.3% to $1,451.89 per ounce at 0712 GMT.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money