Forex – Dollar Slumps Against Yen Amid Trade War Rhetoric

Forex – Dollar Slumps Against Yen Amid Trade War Rhetoric

The dollar plunged further against other currencies in AsiaThe dollar plunged further against other currencies in Asia – The dollar plunged further against other currencies in Asia on Friday morning as U.S. tariffs imposed on Chinese imports and China’s retaliation measures rocked investors’ confidence and sent the dollar down. A lack of data on Friday left markets exposed to sentiment swings.

The that tracks the greenback against a basket of six major currencies last stood at 89.22 at 12:34pm ET (04:34 GMT), down 0.28%. The dollar index hit another low on Friday after trading at this week’s lowest at 89.08 on Thursday.

U.S. President Donald Trump signed a presidential memorandum to target tariffs up to $60 billion in Chinese goods that represent “misappropriation of U.S. intellectual property”.

The People’s Bank of China (PBOC) set the fix rate of yuan against the dollar at 6.3272 versus the previous day’s 6.3167. The pair eased 0.09% to 6.3308.

In response to the U.S. anti-China tariffs, China planned to impose retaliatory tariffs on $3 billion of U.S. imports – 15% tariffs on steel pipes, fruit, wine and other products from the U.S. It also planned to add 25% tariffs on pork and recycled aluminum.  

The pair shed 0.44% to 104.82. The dollar slumped further against the yen to this week’s lowest point of 104.74, breaking the 105 level. The trade in the pair was much driven by risk sentiment at this point as investors are stocking up on the safe-haven currency at times of market volatility, when the world’s two largest economies seem to be heading towards a trade war.

The pair traded at 0.7711, up 0.23%. A bounce in the sentiment-linked Aussie ahead of the Fed policy announcement was aborted by disappointing jobs data as the unemployment rate rose unexpectedly to 5.6% from 5.5% on Thursday and risk aversion after the U.S. slapped China with punitive tariffs.

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