ICM: U.S. Dollar Strengthens as China Halts Trade Talks

ICM, the leading London-based FX and CFDs provider, reported that the greenback was firmer in early trading against main rivals except for Japanese Yen as China canceled trade talks with the United States.

The dollar index which measures the greenback against a basket of major currencies bounced-off a ten-week low of 93.81 on Friday, supported by a weaker pound, and continued stronger to reach a high of 94.37 during today’s Asian session as China halted trade talks for the week. The fears of not reaching a Brexit deal sent the pound lower to log its biggest losing day in a year which increased the demand for the dollar. Moreover, during the past months, the dollar gained support from the mounting trade friction between China and the United States as investors rushed to the safe haven assets. On the other hand, the Federal Reserve will end a two-day policy meeting on Wednesday where market participants expect the Fed to raise rates by 25 basis points. The US 10-year treasury yields reached a four-month high of 3.097 last week.

Gold prices drifted lower as the U.S. dollar surged and Treasury yields hovered near a four-month high ahead of an anticipated rate hike. As per ICM trading platform, the bullion retreated from a three-week high of $1211 to trade at a two-week low of $1191. The gold ounce is still trading in a tight range between a support zone of $1188 and a resistance zone of $1214. On the other hand, the silver ounce fell from a two-week high of $14.43 to settle lower at $14.28.

Oil prices opened higher, as the meeting between OPEC and non-OPEC energy ministers ended with no formal recommendation for any additional supply boost. As per ICM trading platform, the West Texas Intermediate crude futures traded at a ten-week high of $72.13 per barrel, and the Brent futures rose to a high of $80.44 per barrel, slightly short from posting the highest price since late 2014. President Trump urged OPEC to drive the oil prices down as higher gasoline price could create a political headache for Republicans ahead of the mid-term elections.


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