The Japanese yen surpassed one of its major opposing currency, the U.S. dollar, and a 4-1/2 peak against the euro last Tuesday. Investors were wary about a likely combative conference between President of China Xi Jinping and U.S. President Donald Trump.
According to a CNBC report last week, Trump’s administration was inspecting the range of its ability to impose penalty to countries whose currencies it sees as depreciating. The said report didn’t give any particular details on how it would be executed. Trump pledged during his campaign to label China as a country that maneuver its currency for their benefit.
Managing director FX at Jefferies in New York said in terms of Trump/Xi conference and the trade policy in the United States, it’s always hard to determine what parts of forex trading the two will target on.
In previous trading, the dollar subsequently dropped 0.4 percent versus 110.49 yen. Tuesday’s figures was upbeat for the U.S. currency as its trade deficit shortened more than predicted to $43.6 billion last February, a number that can potentially strengthen the growth of their first quarter.
Meanwhile, the euro also traded lower against the safe-have yen, it lost 0.5 percent at yen’s 117.78. On previous close, the euro dropped more than 117.43.
Japan’s stock index Nikkei 225, which tends to shift vice versa to the yen, settled 0.9 percent lower.
On the Down Under, the Reserve Bank of Australia’s verdict unexpectedly kept its rates at a record low of 1.5 percent. However the Australian dollar dropped after the RBA signalled it was not certain about the country’s inflation status.
The bombing on a St. Petersburg railway also influenced the markets as it focused on the presidential election in France this month and the employment figures in the U.S. this week.