• The U.S. dollar index, which tracks the greenback against a basket of currencies, was up 0.06% to 93.84.
Elsewhere, the USD/CNY pair slid 0.16% to 6.8478. There will be no mid-rate from the People's Bank of China today as the Chinese markets are closed for a holiday.
• The safe-haven Japanese yen blipped briefly higher on Monday as investors reacted to news China had canceled trade talks with the United States, just as the latest round of two-way tariffs kicked in.
President Donald Trump’s second round of 10 percent tariffs covering $200 billion of Chinese exports, and counter tariffs from China took effect on Monday.
The early currency moves came in very thin conditions with Japan and China on holiday and were mostly reversed as the session wore on. The dollar soon recovered to 112.58 yen JPY=, having been as low as 112.28 at one stage.
• The U.S. Federal Reserve’s anticipated interest rate hike this week will make cash the most attractive it has been in about a decade and end the era of stocks as the only game in town.
During this bull market which in August broke the record as the longest ever, interest rates were so low that most fixed income assets other than junk bonds yielded less than the inflation rate or the dividend yield on the S&P 500. This drove yield-hungry investors to stocks, the one asset that delivered a real rate of return, or return on investment adjusted for inflation.
• U.S. and Canadian officials trying to reach a deal on NAFTA are “very likely” to hold informal talks on the sidelines of a major U.N. meeting in the next few days, Canadian Prime Minister Justin Trudeau said on Sunday.
Canadian Foreign Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer - the two top officials at the talks - are due to be in New York on Monday and Tuesday for the U.N. General Assembly.
• Japanese Prime Minister Shinzo Abe said he had constructive talks on trade with U.S. President Donald Trump in New York on Sunday ahead of the second round of trade dialogues between the two countries this week.
Abe and Trump will hold a summit meeting on Wednesday on the sidelines of a United Nations General Assembly meeting in New York, Japan’s top government spokesman said on Friday.
• Brexit Secretary Dominic Raab said on Monday that he was confident that the United Kingdom will make progress and eventually clinch a Brexit deal with the European Union.
• Many American business leaders agree that China's trade practices must be addressed, but they object to the use of tariffs, which are paid by companies importing the products. CEOs now have to decide whether to absorb the cost or pass it on to consumers. Some may be able to find a new supplier outside of China, but that takes time.
Thousands of companies have asked the government to exclude certain products from the tariff list, claiming they cannot find another supplier outside of China for the items they need. None of their requests have been granted so far.
• The United States and China imposed fresh tariffs on each other’s goods on Monday as the world’s biggest economies showed no signs of backing down from an increasingly bitter trade dispute that is expected to knock global economic growth.
Soon after the fresh duties went into effect, China accused the United States of engaging in “trade bullyism” and said it was intimidating other countries to submit to its will through measures such as tariffs, the official Xinhua news agency said.
But Beijing also said it was willing to restart trade negotiations with the United States if the talks are “based on mutual respect and equality,” Xinhua said, citing a white paper on the dispute published by China’s State Council.
• Oil prices rose about 2 percent on Monday as markets tightened ahead of Washington’s new sanctions against Iran, with some traders forecasting a spike in crude to $100 per barrel.
Brent crude futures LCOc1 jumped to the highest level since May at $80.43 per barrel, and were up $1.57, or 2 percent, at $80.37 per barrel at 0642 GMT.
U.S. West Texas Intermediate (WTI) crude futures CLc1 rose $1.28, or 1.8 percent, to $72.06 a barrel.
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