AIRLINK 177.92 Increased By ▲ 0.92 (0.52%)
BOP 12.88 Increased By ▲ 0.07 (0.55%)
CNERGY 7.58 Increased By ▲ 0.09 (1.2%)
FCCL 45.99 Increased By ▲ 3.97 (9.45%)
FFL 15.16 Increased By ▲ 0.32 (2.16%)
FLYNG 27.34 Decreased By ▼ -0.36 (-1.3%)
HUBC 132.04 Decreased By ▼ -2.47 (-1.84%)
HUMNL 13.29 Increased By ▲ 0.33 (2.55%)
KEL 4.46 Increased By ▲ 0.02 (0.45%)
KOSM 6.06 No Change ▼ 0.00 (0%)
MLCF 56.63 Increased By ▲ 2.12 (3.89%)
OGDC 223.84 Increased By ▲ 1.26 (0.57%)
PACE 5.99 Decreased By ▼ -0.04 (-0.66%)
PAEL 41.51 Increased By ▲ 0.21 (0.51%)
PIAHCLA 16.01 Increased By ▲ 0.39 (2.5%)
PIBTL 9.88 Decreased By ▼ -0.18 (-1.79%)
POWER 11.16 Decreased By ▼ -0.01 (-0.09%)
PPL 186.63 Increased By ▲ 2.64 (1.43%)
PRL 34.90 Increased By ▲ 0.59 (1.72%)
PTC 23.53 Increased By ▲ 0.19 (0.81%)
SEARL 94.96 Increased By ▲ 3.89 (4.27%)
SILK 1.14 Increased By ▲ 0.03 (2.7%)
SSGC 35.50 Increased By ▲ 1.52 (4.47%)
SYM 15.64 Decreased By ▼ -0.32 (-2.01%)
TELE 7.87 Increased By ▲ 0.01 (0.13%)
TPLP 10.93 Decreased By ▼ -0.08 (-0.73%)
TRG 59.20 Increased By ▲ 0.48 (0.82%)
WAVESAPP 10.78 Decreased By ▼ -0.01 (-0.09%)
WTL 1.35 Decreased By ▼ -0.01 (-0.74%)
YOUW 3.80 Decreased By ▼ -0.01 (-0.26%)
AIRLINK 177.92 Increased By ▲ 0.92 (0.52%)
BOP 12.88 Increased By ▲ 0.07 (0.55%)
CNERGY 7.58 Increased By ▲ 0.09 (1.2%)
FCCL 45.99 Increased By ▲ 3.97 (9.45%)
FFL 15.16 Increased By ▲ 0.32 (2.16%)
FLYNG 27.34 Decreased By ▼ -0.36 (-1.3%)
HUBC 132.04 Decreased By ▼ -2.47 (-1.84%)
HUMNL 13.29 Increased By ▲ 0.33 (2.55%)
KEL 4.46 Increased By ▲ 0.02 (0.45%)
KOSM 6.06 No Change ▼ 0.00 (0%)
MLCF 56.63 Increased By ▲ 2.12 (3.89%)
OGDC 223.84 Increased By ▲ 1.26 (0.57%)
PACE 5.99 Decreased By ▼ -0.04 (-0.66%)
PAEL 41.51 Increased By ▲ 0.21 (0.51%)
PIAHCLA 16.01 Increased By ▲ 0.39 (2.5%)
PIBTL 9.88 Decreased By ▼ -0.18 (-1.79%)
POWER 11.16 Decreased By ▼ -0.01 (-0.09%)
PPL 186.63 Increased By ▲ 2.64 (1.43%)
PRL 34.90 Increased By ▲ 0.59 (1.72%)
PTC 23.53 Increased By ▲ 0.19 (0.81%)
SEARL 94.96 Increased By ▲ 3.89 (4.27%)
SILK 1.14 Increased By ▲ 0.03 (2.7%)
SSGC 35.50 Increased By ▲ 1.52 (4.47%)
SYM 15.64 Decreased By ▼ -0.32 (-2.01%)
TELE 7.87 Increased By ▲ 0.01 (0.13%)
TPLP 10.93 Decreased By ▼ -0.08 (-0.73%)
TRG 59.20 Increased By ▲ 0.48 (0.82%)
WAVESAPP 10.78 Decreased By ▼ -0.01 (-0.09%)
WTL 1.35 Decreased By ▼ -0.01 (-0.74%)
YOUW 3.80 Decreased By ▼ -0.01 (-0.26%)
BR100 12,130 Increased By 107.3 (0.89%)
BR30 37,246 Increased By 640.2 (1.75%)
KSE100 114,399 Increased By 685.5 (0.6%)
KSE30 35,458 Increased By 156.2 (0.44%)
Markets

Euro hits lowest in three weeks as dollar gains from trade optimism

Japanese yen near 5-month low vs dollar Chinese offshore yuan set for sixth winning week vs dollar L
Published November 8, 2019
  • Japanese yen near 5-month low vs dollar
  • Chinese offshore yuan set for sixth winning week vs dollar

LONDON: The euro edged down to hit a new three-week low against the dollar on Friday as the US currency shone on news that China and the United States had agreed to cancel some tariffs as part of a potential preliminary pact to end their trade war.

The two countries have agreed to roll back tariffs on each others' goods in a "phase one" trade deal if it is completed, officials from both sides said on Thursday.

Sentiment is likely to remain supportive for the dollar, equities and other risky assets as a de-escalation in the US-China trade war removes a huge risk to the global economic outlook.

However, there is still some scepticism about a trade deal as officials inside and outside the White House have bristled at the notion of giving up punitive tariffs.

Muddying the waters further, White House spokeswoman Stephanie Grisham told Fox News Channel on Thursday that the United States is "very, very optimistic" about reaching a trade deal with China soon.

"When the trade war was looking like it was worsening, people were buying dollars as a safe haven. Now that the trade war seems to be winding down, people are buying dollars because the US economy will benefit," said Marshall Gittler, strategist at ACLS Global.

"The market's attitude towards the euro is just plain negative right now," he said, adding that he expects the risk sentiment to wind down "unless or until the US administration chimes in with some confirmation" that the tariffs will be rolled back.

The euro fell 0.2% to $1.1028, its lowest since Oct. 15.

The prospects of an end to the US-China trade war left the safe-haven yen nursing losses against most major currencies.

Versus the dollar, the yen was near a five-month low and against the Australian dollar the Japanese currency was close to a 15-week low.

Progress in resolving the 16-month-long trade war also supported China's yuan. In the offshore market, the yuan traded at 6.9834 per dollar, close to a three-month high it jumped to on Thursday. The yuan was set for its sixth straight weekly gain.

Analysts from Bank of America Merrill Lynch, however, see the optimism for the US currency fading eventually.

"For the dollar to weaken back to its long-term equilibrium, we need better global data and to get better global data, we need trade deals," they said in a note to clients.

"We remain optimistic and continue expecting the dollar to gradually weaken next year, as we put trade tensions behind (us) and the outlook of the global economy improves," they said.

Traders will be watching for the University of Michigan consumer survey in the United States, due at 1500 GMT. Economists polled by Reuters expect the survey to inch slightly higher to 95.9 in November from 95.5 in October.

The pound traded just below $1.28, close to the lowest since Oct. 24 and on course for a 1% decline this week.

The Bank of England has so far resisted following the US Federal Reserve and the European Central Bank in cutting its main interest rate, but the outcome of Thursday's meeting suggests the UK central bank is poised to change its stance.

 

Comments

Comments are closed.