The US Dollar continues to move higher against its major rivals on growing expectations that the trade rift between China and the US will be put to rest before this weekend's G20 summit. Those expectations have helped to shift investor sentiment back towards the greenback. Both governments have tentatively agreed to a truce, and the hope is that an agreement will be negotiated that will put an end to the imposition of tariffs. In that case, the potential repercussions on global growth would be positive and that could result in a sentiment shift for the Federal Reserve. Analysts say that, more than any previous G20 meeting, this one could have serious implications for the global economy, depending on the outcome.
As reported at 11:31 am (GMT) in London, the EUR/USD was trading at $1.1369, down 0.0185%; the pair has ranged from a trough of $1.13479 to $1.13816 in this session. The USD/JPY was trading higher at 107.8530 Yen, up 0.0891% and off the session peak of 108.161 Yen. The GBP/USD was trading at $1.2714, off the session low of $1.12669.
Inflation and Growth Data Eyed
In economic news, markets are waiting for the release of preliminary inflation data from Germany; analysts are predicting that the harmonized index of consumer prices for July will be flat at 1.3% on an annual basis, while on a monthly basis the numbers should show a decline to 0.1% from 0.3%. In the US, labor data will be released first, with expectations of a slight rise in jobless claims, both new and continuing. GDP data will also be released, with annualized GDP predicted to be flat at 3.1% for the first quarter, while the GDP index should rise to 0.8% from 0.5%.