U.S. dollar extended its declines after the U.S.-China trade spat might affect the economy

Dollar trades lower

The U.S. dollar dropped again on Monday’s opening bell, extending its losses on the previous week on concerns that the tension between China and the United States might be worsened. The released news that suggested an employment growth in the country has also weighed on the dollar.

Last Friday, China warned that it is prepared to respond with a counter strike on its trade performance, only if the U.S. will follow the threat of Trump to approve tariffs on Chinese goods worth more than $100 billion. The rising tension between the two nations has agitated investors of a possible trade war as it might disrupt the economic well-being of the two. However, some are still hopeful that negotiations will fix the damages it made to global equities.

The index which tracks the value of the greenback against its major opposing currencies, the U.S. dollar index, is last seen at 90.180. It was dragged lower from its highest level in one month of 90.567 touched before Friday’s U.S non-farm payrolls report.

The U.S. currency has been depreciated by its Japanese counterpart and the Swiss franc on the previous trade, following China’s statement that heightened worries regarding the trade spat between China and the U.S. Barclays’ senior strategist in Tokyo Shinichiro Kadota said that risk aversion does not look too intense that the past weeks because hopes of hopes for agreement between the two. He added that the phase when the greenback is always dropping is over.

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