The dollar and yen mostly held the safe-haven high ground on Tuesday, with investors wary of a looming deadline for U.S. tariffs on China, the British election and upcoming Federal Reserve and European Central Bank meetings.
Front of mind is whether Washington will go ahead with a fresh round of tariffs on Sunday, or whether a deal with China can be reached before then.
White House economic adviser Larry Kudlow said on Friday that the Dec. 15 deadline is still in place, but Agriculture Secretary Sonny Perdue on Monday raised the possibility the tariffs are not imposed.
“There’s risks both ways,” said Westpac FX analyst Imre Speizer.
“Trade’s still the flip-floppy factor, but I think markets are still reasonably upbeat about risk-seeking. All these little movements are only smoke and noise, and don’t really tell you what’s going on. Cautiously positive would be the overall mood.”
Soaring inflation in China, ahead even of lofty expectations, had little effect on a market waiting for trade news.
Against the Japanese yen JPY=, the greenback found support after last week's declines, steadying at 108.62 yen. The dollar dipped slightly against the euro to $1.1066 and was steady against a basket of currencies at 97.623.
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