Left Menu
Development News Edition

FOREX-Imminent Sino-U.S. deal signing lifts Asian currencies; sterling slips

FOREX-Imminent Sino-U.S. deal signing lifts Asian currencies; sterling slips
Image Credit: Pixabay

The imminent signing of a preliminary Sino-U.S. trade deal helped Asian currencies rally on Monday, but sterling fell on fresh hints of a Bank of England rate cut.

The U.S.-China Phase 1 agreement, due to be signed at the White House on Wednesday, marks the first step toward ending a damaging 18-month trade dispute between the world's two largest economies. "Both sides should produce a lot of positive headlines, really talking up the deal and sounding positive about the outlook," said Westpac FX analyst Sean Callow.

"The more difficult questions on trade can come later. I think for this week the vibe on the trade side will be very positive and that may help sentiment a bit." Relief that fears of conflict in the Middle East were fading, despite ongoing tensions centred on Iran, also helped sentiment, drawing investors away from safe havens like gold and the yen.

The trade-exposed Chinese yuan and Australian dollar each rose 0.3% to lead broad gains. The yuan - the currency most attuned to Sino-U.S. trade developments - crossed the 6.9 per dollar mark to hit a fresh five-month high of 6.8959.

The Aussie hit a one-week high of $0.6919. The New Zealand dollar also climbed 0.2% to its strongest since Thursday at $.6650 and the euro was steady at $1.1128. The Japanese yen weakened 0.1% to 109.60 per dollar, close to a seven-month low, and it slid 0.6% to an 8-month low against the trade-sensitive Korean won. A holiday in Japan reduced overall trading volumes.


Elsewhere, the British pound fell 0.3% to $1.3037 and flirted with a two-week low after dovish comments from Bank of England policymaker Gertjan Vlieghe over the weekend.

Vlieghe told the Financial Times newspaper that he would vote for a cut in interest rates later this month, barring an "imminent and significant" improvement in growth data. Futures pricing pointed to an implied probability of a rate cut at the end of the month of one-in-four.

"Are these hollow threats...designed to try and curb the appreciation in the pound, or are they really going to try and follow through?" said Chris Weston, head of research at Melbourne brokerage Pepperstone. "The market's saying on balance that they're hollow thoughts (but) a rate cut is not out of the question."

Elsewhere in the markets, the Taiwan dollar rose to its strongest in more than 18 months after the re-election of President Tsai Ing-wen at the weekend removed some uncertainty.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

Download The Devdiscourse News App for Latest News.



Conspiracy theories on COVID 19: Legislators, Scientists, and Journalists all joined the Caravan

Conspiracy theories are not new for virus epidemics. There have been conspiracy theories on HIV-AIDS, Polio Vaccines, Ebola Virus, and several other diseases as well. However, what makes the 2019 Novel Coronavirus different from others is ...

Top 10 Fake News, Myths and Realities on 2019 Novel Coronavirus COVID 19

With nearly 1500 deaths by January 14 and around 65,000 infections in China, the Novel Coronavirus 2019 has become one of the worst health epidemics of the 21st Century. However, 8,573 people have been cured but the rumor mongers are a...

Handling fake news Infodemic in time of Coronavirus epidemic

Social media has provided a platform where everybody can disseminate his her views without any supervision. Its excellent if the message is genuine but misinformation is equally disastrous. Health is such a topic where every Tom and Harry c...

Sentiment Analysis on Budget 2020: Long shot for solution to economic worries?

Industries and individuals alike had high expectations from the government to take tangible steps but the budget 2020 seems to have failed expectations....


Latest News

Optimism, fear and expectations mark first day of violence cut period in Afghanistan

Afghans on Saturday welcomed the pledge by the Taliban and U.S to reduce violence, despite uncertainty looming over the war-torn country.Saturday was the first morning of a seven-day reduced violence period that is meant to lead to an agree...

Cabinet expansion likely in U'khand

Chief Minister Trivendra Singh Rawats latest meeting with BJP president J P Nadda has fuelled speculations that a Cabinet expansion is likely in Uttarakhand. Rawat had nearly a ninety-minute meeting with Nadda on Friday in New Delhi during ...

Uncertainty over evacuation causing anxiety, mental stress to Indians stuck in Wuhan: Official sources.

Uncertainty over evacuation causing anxiety, mental stress to Indians stuck in Wuhan Official sources....

Shaheen Bagh protest an example of struggle between rights and duties of people: Naqvi

Minority Affairs Minister Mukhtar Abbas Naqvi on Saturday termed the Shaheen Bagh protest against CAA an example of the struggle between rights and duties of the people. They protesters understand their rights but not their duties. I do not...

Give Feedback