Dollar Holds Gains from US-China Trade Breakthrough
The dollar index hovered near one-month highs around 101.6 on Tuesday, after gaining more than 1% in the previous session.
The rally followed news that the US and China reached a temporary agreement to lower tariffs, easing recession fears. Following successful negotiations in Switzerland over the weekend, Washington and Beijing agreed to cut their respective tariffs to 30% and 10% for a 90-day period.
Treasury Secretary Scott Bessent indicated plans to meet with Chinese officials again in the coming weeks to begin discussions on a broader trade agreement. The rollback in tariffs sparked optimism toward the dollar, which had faced pressure earlier this year amid concerns that President Trump’s trade policies were diminishing the attractiveness of US assets.
Investors now turn their attention to the latest consumer inflation report for signs of how the new tariff regime has affected prices.
Source: Trading Economics