• The dollar held above a recent 1-1/2 month trough against a basket of major currencies on Monday as investors awaited details on a new round of U.S. tariffs against China, which could further sour relations between the two giants.
Currency moves were minor as investors awaited details while liquidity was thin with Japan’s financial markets closed for a holiday.
The dollar index against a basket of major currencies held at 94.911, well above Friday’s 94.359, which was the lowest since end-July.
Against the yen, the dollar was last at 111.98 yen after climbing to 112.16 on Friday which was the highest since mid-July.
The dollar traded higher against the yuan despite a lower daily fix by the Chinese central bank. The dollar was last at 6.87 from Friday’s close of 6.86.
The euro was last at $1.1633, down from a three-week top of $1.1721 set on Friday. The pound also retreated, easing from last week’s peak of $1.3145 to trade at $1.3076.
• Economic problems in emerging markets and the ongoing trade war between the U.S. and China could increase the risk of the next financial crisis, according to Heenam Choi, CEO of the Korea Investment Corporation.
The trade spat between the two largest economies in the world won't be easy to resolve, Choi told CNBC.
Choi explained that, if the trade dispute escalates and Chinese exports are severely affected by U.S. tariffs, then that would ultimately affect South Korea's own economy.
• Despite imposing some tariffs on each others' imports, the U.S. and China have not yet entered a stage where it's fully a trade war, and there's a good chance "sanity" will ultimately prevail in the disagreement, the chairman of Swiss investment bank UBS told CNBC.
The trade dispute is affecting the relationship between the two countries beyond the trade of goods and is having an impact on services, Axel Weber said.
• Escalating trade tensions between the United States and China would have manifested with or without Donald Trump, experts said at the Singapore Summit on Saturday.
"I think we must not exaggerate the importance of Trump," said Dani Rodrik, a professor at Harvard University, pointing to structural problems in the world economy.
• China will not be content to only play defense in an escalating trade war with the United States, a widely read Chinese tabloid warned, as President Donald Trump was expected to announce new tariffs on $200 billion in Chinese goods as early as Monday.
Beijing may also decline to participate in proposed trade talks with Washington later this month if the Trump administration goes ahead with the additional tariffs, the Wall Street Journal reported on Sunday, citing Chinese officials.
• Economic troubles in emerging markets and the ongoing trade war between the United States and China could potentially increase the risk of the next financial crisis, according to the chief executive officer at South Korea's sovereign wealth fund.
As the global economy continues to grow, the U.S. Federal Reserve and other central banks are looking to tighten their monetary policies, which could lead to a sudden "liquidity squeeze" in some emerging markets, Heenam Choi, CEO of the Korea Investment Corporation (KIC), told CNBC at the annual Singapore Summit.
A so-called liquidity squeeze is essentially when economic conditions in a country become too tight, and borrowing becomes more difficult, driving down consumption and investments, and ultimately hitting economic growth.
• British Prime Minister Theresa May has warned rebels in her party that the alternative to her potential Brexit deal with the EU is no deal.
The main sticking point to agreeing a deal between Britain and the EU is the issue of ensuring there will be no hard border between Northern Ireland and the Irish Republic after Brexit.
The Times newspaper reported that the EU’s chief negotiator, Michel Barnier, is working on a new protocol text outlining how to use technology to minimize checks on the border.
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