50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Forex Calm Before ECB meeting, Trump Pushes China Deal  

Published 03/06/2019, 11:45 PM
© Reuters.  Forex traders await European Central Bank’s policy review
USD/JPY
-
AUD/USD
-
USD/CNY
-
USD/NZD
-
DX
-

Investing.com - Forex traders are paying close attention to the European Central Bank’s (ECB) policy review later on Thursday, to see what it will do to cushion a slowdown in the euro zone economy. Traders are also keeping an eye on U.S. President Donald Trump’s newfound eagerness to forge a final trade deal with China.

Reuters reported that some traders expect signals from the ECB of a delay in rate hikes until next year and a relaunch of long-term bank loans soon to counteract an economic slowdown.

The U.S. Dollar Index that tracks the greenback against a basket of six major currencies rose by 0.04% to 96.838 by 10:40 PM ET (3:40 AM GMT).

Hope that the trade dispute between China and the U.S. will finally come to an end boosted market sentiment.

On Wednesday, Bloomberg reported that Trump is pushing for a trade deal with China, which could help him with the 2020 re-election campaign. Investors are awaiting a final deal result that could end the year-long trade war between the world’s two biggest economies.

The Australian gained some ground against the dollar as the AUD/USD pair rose 0.15% to 0.7043.

Earlier in the week, data showed that Australian GDP grew 0.2%, below the 0.3% that had been widely expected. The slowdown in growth fuelled speculation over a possible rate cut later this year. The Australian dollar also took a hit last month after the RBA stepped back from a long-standing tightening bias.

The USD/CNY pair inched up marginally by 0.01% to 6.7104. The yuan remained supported by a possible U.S. trade deal.

On top of setting a target band for the 2019 economic growth between 6% and 6.5%, the Chinese government also said at the ongoing annual meeting of the National People's Congress that the country is cutting taxes and fees by nearly CNY2 trillion ($300 billion) to support various industries. 

The People's Bank of China (PBOC) set the yuan reference rate at 6.7110 versus the previous day's fix of 6.7053.

Elsewhere, the USD/JPY pair was down 0.04% to 111.71. Soft U.S. data, the dragging Sino-U.S. trade talks and the uncertainty surrounding Brexit are contributing to a risk-off sentiment.

The USD/NZD pair was up 0.21% to 1.4739.

Besides the ECB meeting, traders are also looking to Friday’s U.S. non-farm payrolls release for February, which will point to the strength of the labor market.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.