The US dollar edged higher on Friday as investors prepared for the fallout from trade talks between the US and China at the G20 meeting yesterday, which investors expect would increase volatility across markets.
US President Donald Trump on Thursday sent mixed signals about the prospects for a trade deal with China, saying an agreement was close, but he was not sure he wanted one, just as he left for Argentina for a meeting with Chinese President Xi Jinping (習近平).
US Trade Representative Robert Lighthizer on Friday said that he would be surprised if yesterday’s dinner between Trump and Jinping “wasn’t a success.”
“For now, really, the trade issue seems to be a dominant theme swaying sentiment,” said Mazen Issa, senior foreign-exchange strategist at TD Securities in New York. “If you have any sort of news or headlines that is indicative of a positive or negative outcome, I think markets are going to react accordingly.”
In Taipei, the New Taiwan dollar on Friday fell against the greenback, shedding NT$0.010 to close at NT$30.850. The NT dollar rose 0.2 percent against the US dollar from last week’s NT$30.902.
The US dollar index on Friday gained 0.42 percent to 97.20, up 0.3 percent for the week.
The Chinese yuan on Friday weakened 0.08 percent to 6.95 per US dollar.
Credit Suisse Group AG strategists expect the Chinese currency to weaken to a decade-low of 7.20 per US dollar by the end of next year.
Data on Friday showed that growth in China’s vast manufacturing sector last month stalled for the first time in more than two years as new orders slowed, piling pressure on Beijing ahead of the trade talk.
Investors were also continuing to evaluate comments by US Federal Reserve Chairman Jerome Powell on Wednesday that the US central bank’s policy rate is now “just below” neutral, a level that neither brakes nor boosts a healthy US economy.
The immediate reaction sent the US dollar tumbling as investors saw the Fed as likely to end its hiking cycle sooner than previously expected.
Interest-rate futures traders are pricing for only one rate hike next year, according to the CME Group’s FedWatch Tool, below Fed projections of three increases during the year.
However, some analysts saw the move as exaggerated, with the Fed more likely to let economic data guide it on when to pause tightening.
“There’s no denying that the Fed rhetoric has changed in recent weeks, but we don’t think it’s changed quite as much as the repricing in rates suggests it has,” said Adam Cole, chief currency strategist at RBC Capital Markets in London.
South Korean won held onto this week’s losses as Friday’s interest rate increase did little to assuage concern surrounding the economy.
The pound remained under pressure after British Prime Minister Theresa May warned of the prospect of a “no deal” Brexit.
Additional reporting by Bloomberg and CNA
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors
RSS