• The dollar rose on Tuesday, led by gains against the yen and Swiss franc, as risk appetite improved and Wall Street’s main indexes advanced, helping the U.S. currency stabilize after recent declines.
The outlook for the dollar, however, remains murky due to global trade tensions. The greenback has lost 2 percent so far this year.
In afternoon trading, the dollar rose 0.2 percent against a basket of currencies to 90.184 .DXY. It was last down 0.3 percent at $1.2269 EUR=.
Against the yen, which tends to benefit in times of economic uncertainty, the dollar snapped three days of losses to trade 0.6 percent higher at 106.58 yen JPY=.Traders though are still betting on a stronger yen and a broadly weakened dollar if the trade tensions escalate.
• The Trump administration on Tuesday raised the stakes in a growing trade showdown with China, announcing 25 percent tariffs on some 1,300 industrial technology, transport and medical products to try to force changes in Beijing’s intellectual property practices.
• The U.S. Trade Representative’s office unveiled a list of mainly non-consumer products representing about $50 billion of estimated 2018 imports that would nonetheless hit supply chains for many U.S. manufacturers. The list ranges from chemicals to TV sets, motor vehicles and electronic components.
• China will take counter-measures of the “same proportion” and scale if the United States imposes further tariffs on Chinese goods, China’s ambassador to Washington said, amid growing fears of an impending trade war.
• China on Tuesday condemned the U.S. announcement of tariffs on $50 billion worth of Chinese imports and said it would “take corresponding measures of equal scale and strength against U.S. products.”
• Escalating trade tensions between the United States and China are unlikely to hurt global economic growth, Brazilian central bank chief Ilan Goldfajn told Reuters on Tuesday.
• U.S. interest rate hikes remain appropriate even while tax cuts and a government spending boost potentially help to lift inflation to a Federal Reserve target, Fed Governor Lael Brainard said on Tuesday.
“Gradual” rate hikes are necessary in the face of such tailwinds, she said, adding that U.S. trade policy in particular stood out as a “material uncertainty” for the economy.
High asset prices and growing economic pressure from U.S. fiscal stimulus mean financial markets may be particularly vulnerable to an unexpected shock, an influential Federal Reserve governor said on Tuesday, warning the central bank could respond with stronger requirements on banks as needed.
• Also on Tuesday, San Francisco Fed President John Williams was named head of the New York Fed, a move expected to cement the U.S. central bank’s gradual rate-hike policy.
John Williams, the genial president of the Federal Reserve Bank of San Francisco and a top monetary economist, was promoted on Tuesday to head the New York Fed in a politically explosive decision that has been criticized for ignoring more diverse candidates.
• President Donald Trump on Tuesday said he planned to use U.S. military forces to protect the nation's southern border with Mexico until there is a border wall and "proper security."
• President Donald Trump said on Tuesday he is thinking very seriously about pulling U.S. troops out of Syria, and will make a decision soon about lessening support in the war-battered country.
• U.S. President Donald Trump, standing alongside the leaders of three Baltic countries most concerned about the potential for aggression from Moscow, on Tuesday said he thought he could have a good relationship with Russian President Vladimir Putin.
• Russian President Vladimir Putin said on Tuesday he hoped a planned meeting of the global chemical weapons watchdog would help to defuse a major diplomatic row triggered by the poisoning of a former Russian double agent in England.
• Oil edged up on Tuesday, supported by a recovery in the equities market and on a technical bounce for crude after the biggest daily percentage drop in almost a year, but Brent futures stayed well below$70 a barrel.
Brent crude futures gained 48 cents, or 0.7 percent, to settle at $68.12 a barrel. This followed a nearly 4 percent drop in Brent prices on Monday, the largest since June. Brent had risen to $71 a barrel last week, close to its highest this year.
West Texas Intermediate futures rose 50 cents, or 0.8 percent, to settle at $63.51 a barrel.
Reference: Reuters
Thai
Eng