The US Dollar was trading close to a 21/2-month peak versus the Japanese Yen during Monday morning trade in Sydney. Improved sentiment for the greenback came after the Chinese and US governments announced that there seems to be progress on the trade talks between the two largest economies. According to the joint statement, a trade deal at “Phase 1” has finally been reached; that phase of the agreement includes protections for intellectual property as well as agriculture and currency.
The USD/JPY was trading at 108.2550 Yen, down 0.0969% as of 12:13 pm in Sydney. Earlier, the pair had hit a high of 108.63 Japanese Yen, with the low for the pair recorded at 108.232 Yen. The AUD/USD was trading down at $0.6776, a loss of 0.29% while the NZD/USD was at $0.6308, down 0.4435%.
Analysts Cautiously Optimistic
After President Trump's clarification on the progress, analysts dismissed it largely as so much rhetoric. One currency strategist says it does very little to shift sentiment as regards the outlook for growth and global trade. They view this Phase 1 as nothing more than a symbolic gesture. For many FX players, though, the fact that there is some progress, albeit less than hoped, could be enough to temporarily boost sentiment for the greenback.