The US Dollar was largely under pressure in Asian trade on Friday ahead of the G20 summit in Osaka. FX traders are hopeful that there will be a positive outcome in the talks between Beijing and Washington as it relates to trade and tariffs. On Thursday, the media had reported that the two governments were laying out the blueprints of an agreement that would successfully thwart the imposition of $300 billion additional tariffs on imports from China. Because there has been no clarity, market players are cautiously optimistic yet analysts continue to assert that the caution is a necessity given that a resolution is far from a done deal.
As reported at 11:02 am (JST) in Tokyo, the USD/JPY was trading at 107.6740 Yen, down 0.1336% and moving off the earlier high of 107.821 Yen. The AUD/USD was lower at $0.7001, a loss of 0.0628%, while the NZD/USD was down 0.097% and trading at $0.6693.
US-Sino Trade Rift in Focus
The rift between China and the US has been a protracted one, lasting almost a full year, and the repercussions are being felt around the world. The slowdown in productivity and growth as a result of the slowdown in China's economy has forced many of the developed nations' central banks to embark on an easing policy in an effort to stimulate the respective economies. A resolution now would likely lead to a shift back to a more hawkish sentiment for the central banks.