Yahoo Finance U.S. Dollar, Yuan Slip Despite Renewed Trade Optimism
Investing.com - The U.S. dollar and the Chinese yuan slipped on Thursday in Asia despite recent reports that suggested Beijing and Washington are closing in on a trade agreement.
The U.S. dollar index that tracks the greenback against a basket of other currencies slipped 0.1% to 96.620 by 12:01 AM ET (04:01 GMT).
The USD/CNY pair rose 0.1% to 6.7144.
The fall in the dollar and the yuan came despite progress in trade talks and the People’s Bank of China setting higher mid-point reference rates.
The Federal Reserve’s decision to abandon all rate hike projections for the rest of 2019 due to concerns on slowing domestic growth might be putting the dollar under pressure, analysts said.
"The end of the Fed's tightening cycle now appears to be more clearly in sight, and indeed there is some risk it has already been reached. Overall, evolving Fed policy should become an increasing headwind for the U.S. dollar, and an increasing tailwind for the renminbi," said Erik Nelson, currency strategist at Wells Fargo (NYSE:WFC), in a Reuters report.
Meanwhile, worse-than-expected job growth in the U.S. private sector reported on Wednesday supports the Fed’s view to extend a pause on rate hikes.
Private payrolls grew by 129,000 last month, a sharp decline from the 197,000 in February, according to a report released Wednesday by ADP (NASDAQ:ADP) Moody's Analytics. That missed economists’ forecast of 184,000.
The GBP/USD pair edged up 0.1% to 1.3172. The U.K. Parliament approved a bill to block a no-deal Brexit. The passage of the bill sets the U.K. on course for a long Brexit extension unless Prime Minister Theresa May could manage to salvage her withdrawal deal in the coming days.
The U.K. had originally been due to leave the EU on March 29, but the deadline was pushed back to April 12 to allow the U.K. parliament more time to approve the withdrawal agreement. But the agreement has failed to win a majority three times.
The USD/JPY pair was down 0.1% to 111.36.
The AUD/USD pair and the NZD/USD pair rose 0.1% and 0.2% respectively.
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