© Reuters. The dollar declined as tensions fade
Investing.com – The dollar retreated against a basket of other major currencies on Tuesday, fears of a trade war between the United States and China is calming after the chinese president Xi Jinping has promised to reduce import tariffs.
The dollar index, which measures the greenback’s strength versus a weighted basket based on the trade of six major currencies, was down 0.31% to 89,26 before 9h58 (13h58 GMT).
The concerns over the friction business decreased after that Mr. Xi declared that China would reduce import duties on vehicles, encourage imports, and would strengthen the protection of intellectual property.
Speaking at the Forum of Boao, Mr. Xi also said that the cold war mentality, the thinking of zero-sum and isolationism was irrelevant in the world today, and that only the development and co-operation in peaceful could bring results.
The remarks helped soothe the minds of investors about the dispute tariff.
In addition, the u.s. data on Tuesday showed that producer prices rose more than expected in march, underscoring the need for the federal Reserve to increase borrowing costs.
The euro has reached highs of two weeks, with the EUR / USD rising 0.38% to 1,2365.
The single currency was boosted after that the decision-maker Ewald Nowotny, the european central Bank, has said on Tuesday that it was time to “normalize” its monetary policy.
The british pound was also higher, with GBP / USD rising 0.34% to 1,4178.
The british pound strengthened after the member of the monetary policy committee of the Bank of England, Ian McCafferty, said in an interview to Reuters that the interest rate the british should be addressed without delay.
Against the yen, the dollar was higher, with USD / JPY rising 0.21% to 106,99.
The yen refuge, which tends to be sought after by investors in times of uncertainty, political or economic, has won over the previous two sessions.
Losses in the yen have been mastered in the middle of geopolitical concerns. The markets fear that the relations between the United States and Russia will deteriorate due to increased tensions following an alleged attack with chemical weapons in Syria.