· The dollar slipped to a one-week low against the Japanese yen on Wednesday, undermined over the China-U.S. trade deal, and the possibility of fresh tariff hostilities with Europe.
Volume was light ahead of the U.S. Independence Day holiday on Thursday. U.S. economic reports on Wednesday were mixed and did not really change the dollar’s trading direction.
Data from payrolls processor ADP showed U.S. companies added 102,000 private sector jobs in June, much higher than the revised41,000 jobs in May. But the June figure was lower than the 140,000 analysts had forecast.
Against a basket of six currencies, the dollar eased from Tuesday’s two-week highs to trade little changed on Wednesday at 96.736.The index earlier fell as bond yields extended the previous day’s decline, with 10-year yields hitting 2-1/2-year lows below 1.94%.
The euro, meanwhile, was little changed at $1.1283 following a volatile session on Tuesday.
The common currency briefly got a lift on Tuesday after a media report that European Central Bank was in no rush to cut rates at the July meeting. But it later slipped after IMF Managing Director Christine Lagarde, perceived as a policy dove, was nominated as the next ECB president.
· The yield on the benchmark 10-year Treasury note fell to its lowest level since November 2016 on Wednesday, continuing its slide below 2% on expectations central banks around the world would respond to a slowing global economy with more monetary stimulus.
At around 12:09 p.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was lower at around1.95%, off a low of 1.939% hit in overnight trading. The rate on the 3-month Treasury bill held steady at 2.205%, keeping a portion of the yield curve inverted.
Traders around the world snapped up government debt after the European Council on Tuesday nominated Christine Lagarde to head the European Central Bank. Many viewed the choice of Lagarde as a signal that euro zone rates will remain low for the foreseeable future as the ECB tries to foster inflation and GDP growth in the region.
· The U.S. government said on Wednesday it was reviewing license requests from U.S. companies seeking to export products to China’s Huawei Technologies Co Ltd “under the highest national security scrutiny” since the company is still blacklisted.
· Top representatives from the United States and China will meet in the coming week to continue trade talks between the world’s largest economies, White House economic adviser Larry Kudlow said on Wednesday.
· Oil prices were steady on Wednesday ahead of a U.S. holiday, after a steep fall the previous session when worries about a slowing global economy outweighed a decision by OPEC and allies to extend crude output cuts.
September Brent crude futures were up 65 cents, or 1%, at $63.05 a barrel by 11:57 a.m. ET (1557 GMT).
U.S. crude futures for August delivery were up 24 cents, or 0.4% at $56.49 a barrel. On Tuesday, both benchmarks fell more than4% on worries about a global economic slowdown.
Reference: Reuters, CNBC
Thai
Eng