Dollar Gaining Ground As Trade War Escalates

WASHINGTON (Alliance News) - The dollar is strengthening against its major rivals Wednesday ...

Alliance News 11 July, 2018 | 7:52PM
Email Form

WASHINGTON (Alliance News) - The dollar is strengthening against its major rivals Wednesday afternoon on renewed concerns over the trade war between the US and China. President Donald Trump has ordered US Trade Representative Robert Lighthizer to begin the process of imposing tariffs of 10% on an additional USD200 billion of Chinese imports.

The move comes after the US imposed a 25% tariff on USD34 billion worth of Chinese imports last Friday, leading China to retaliate by imposing tariffs on USD34 billion worth of US exports.

Producer prices in the US increased by slightly more than expected in the month of June, according to a report released by the Labor Department on Wednesday.

The Labor Department said its producer price index for final demand rose by 0.3% in June after climbing by 0.5% in May. Economists had expected prices to edge up by 0.2%.

A report released by the Commerce Department on Wednesday showed wholesale inventories in the US increased by slightly more than expected in the month of May. The Commerce Department said wholesale inventories climbed by 0.6% in May after inching up by 0.1% in April. Economists had expected inventories to rise by 0.5%.

The dollar slid to a low of USD1.1758 against the Euro Wednesday, but has since bounced back to around USD1.1680.

The buck dipped to a low of USD1.3285 against the pound sterling Wednesday morning, but has since rebounded to around USD1.3215.

The greenback has broken out to a 6-month high of Y111.965 against the Japanese Yen Wednesday, from an early low of Y110.766.

Producer prices in Japan were up 0.2% on month in June, the Bank of Japan said on Wednesday. That was in line with expectations and down from 0.6% in May.

Core machine orders in Japan fell 3.7% on month in May, the Cabinet Office said on Wednesday - coming in at 907.9 billion yen. The headline figure beat expectations for a decline of 4.9% following the 10.1% spike in April.

Japan's tertiary activity index increased for the second straight month in May, though marginally, data from the Ministry of Economy, Trade and Industry showed Wednesday. The tertiary activity index edged up 0.1% month-over-month in May, following a 1.0% rise in April. In contrast, economists had expected a 0.3% decrease for the month.

Copyright RTT News/dpa-AFX

Email Form
About Author Alliance News

Alliance News provides Morningstar with continuously updating coverage of news affecting listed companies.