The U.S. government widened its trade blacklist to include some of China’s top AI startups. This move exacerbated tensions ahead of high-level trade talks in Washington this week.
The US is hitting back against Chinese entities allegedly involved in facilitating human rights abuses in camps in China’s Xinjiang region. Twenty-eight Chinese companies, government offices and security bureaus have been added to a US blacklist. This blacklist bars such entities from buying US products or importing American technology.
The decision targets 20 Chinese public security bureaus and eight companies. The action bars the firms from buying components from U.S. companies without U.S. government approval. U.S. officials said the action was not tied to this week’s resumption of trade talks with China. But it signals no let-up in Donald Trump’s hard-line stance as the world’s two biggest economies seek to end their 15-month trade war.
China said the United States should stop interfering in its affairs. It will continue to take firm and resolute measures to protect its sovereign security according to a Chinese official.
In August, the Trump administration also released an interim rule banning federal purchases of telecommunications equipment from five Chinese companies, including Huawei and Hikvision.
Huawei has repeatedly denied it is controlled by the Chinese government, military or intelligence services. The Chinese tech company has filed a lawsuit against the U.S. government’s restrictions.
Deputy-level meetings between U.S. and Chinese trade negotiators began in Washington on Monday, with little immediate signs of progress.
START TRADINGForex – China’s AI startups added to US blacklist
A rally in Asian equities spilled over into currency markets. Market watchers attributed the moves to positioning after a bout of volatility last week. Markets will be looking for comments from U.S. Federal Reserve Chairman Jerome Powell later in the day.
The dollar fell on Tuesday, with the New Zealand dollar leading gains against the U.S. currency. Against a basket of other currencies, the dollar dipped 0.1% to 98.85 after posting its biggest single-day rise in a week in the previous session.
The euro got a boost from German industrial output, data which unexpectedly rose in August. The single currency gained 0.2% to $1.0989 but remained within sight of last week’s $1.08790, its lowest in more than two years.
The Australian and New Zealand dollars, which are linked to global trade, edged higher as some investors reduced bearish bets. Dealers warned the move could fade depending on the trade talks in Washington.
The pound hit a one-month low against the euro on Tuesday after reports that Brexit talks between Britain and the European Union are close to breaking down. The sterling fell 0.5% to a one-week low of $1.2226 and weakened more than 0.7% against the euro. The British currency touched a low of 89.93 pence – its weakest level since Sept. 9.
Gold prices firmed on Tuesday after touching a near one-week low. Spot gold rose 0.5% to $1,500.35 per ounce, as of 0931 GMT. Prices had dropped as much as 1% in the previous session.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money