The dollar remained firmly above three-week lows on Thursday as investor optimism about a trade deal between the United States and China declined. Also supporting the dollar was renewed tension between Pakistan and India which encouraged traders to seek safe-haven assets. The dollar index hit a three-week low of 95.883 .DXY on Wednesday, but bounced back to trade at 96.11 .DXY as of 2:22 p.m. HK/SIN on Thursday.
The greenback was lower against the yen, down 0.16 percent to 110.80. The dollar was trading slightly higher against the British pound on Thursday afternoon, after the pound hit seven-month highs on Wednesday on increased expectations that the Brexit will be delayed. The pound was down 0.07 percent against the dollar, to $1.3296 in the mid-afternoon. The pound gained 2.8 percent in January, and is poised to surge approximately 1.5 percent higher in February. approximately 1.5 percent higher in February.
Is Talk Cheap?
The White House announced on Thursday that President Trump’s meeting with South Korean leader Kim Jong Un will be shortened. The meeting was supposed to focus on the nuclear deal between the countries, but it appears that the meeting would be only a brief 30 minutes, and that President Trump would be leaving immediately, though no clear reason was given.
Talks between trade representatives from the U.S. and China also took a confusing turn as President Trump continued to argue with U.S. Trade Representative Robert Lighthizer, who has said that the thinks Trump will settle for a weak deal with China. Lighthizer has been the chief negotiator for Washington, but Trump does have the power to override his efforts with a deal of his own if he so desires. According to CNBC, Lighthizer told the House Committee on Ways and Means on Wednesday that “much still needs to be done before an agreement is reached.” This comment directly negated Trump’s statements that the talks were in their “advanced stages.” The conflicting comments increased trader concern that a trade deal isn’t as imminent as previously believed.