US dollar is in an undecisive position as international relations get tense
The US dollar was on the retreat in early Asian trading on May 18. Forex market was impacted by a new round of US-China bout.
This weekend the tensions between the two leading economies were reignited. Peter Navarro - the trade advisor for the White House - stated that Chinese authorities purposefully sent “hundreds of thousands” of people to other countries in order to spread the virus and was hiding the information about COVID-19 for at least two months.
By 14:45 GMT the US Dollar Index was at 100.362, losing 0.1%. Earlier the index reached its highest level in three weeks.
The market was also influence by the new forecast from Jerome Powell - the Chairman of the Federal Reserve He claimed, that the national economy might contract by as much as 30% in Q2. The “new Great Depression” scenario, however, is unlikely.
The USD/JPY trading pair was at 107.12, gaining 0.1%. According to the latest report, Japan's’ economy is in a recession for the first time in five years.
The USD/CNY pair was at 7.1058, gaining 0.06%. On May 15 the United States stopped chip deliveries to Huawei, effectively blocking the launch of telecom’s behemoth 5G broadband. Traders are waiting for the retaliation.
The GBP/USD was at 1.211, gaining 0.05%. The chief economist of the Bank of England claimed that the institution is evaluating the possibility of lowering interest rates below zero.