Dollar edges up as Trump unveils new tariffs; bitcoin at record
The dollar edged up across the board on Friday as U.S. President Donald Trump's ramped-up tariffs on Canada and other trading partners sparked a flight to safety.
Trump issued a letter late on Thursday that said a 35% tariff rate on all imports from Canada would apply from August 1. The European Union was set to receive a letter by Friday.
The U.S. president, whose global wave of tariffs has upended businesses and policymaking, floated a blanket 15% or 20% tariff rate on other countries, a step up from the current 10% baseline rate.
This week he surprised Brazil, which has a trade surplus with the United States, with duties of 50%, and hit copper, pharmaceuticals and semiconductor chips.
"There do appear to be some tariff jitters creeping in once again after Trump floating the blanket tariffs yesterday," Michael Brown, market analyst at online broker Pepperstone in London, said.
"Overall the moves that we have seen in the FX space are relatively contained, and recent ranges seem to still be respected for the time being," he added.
The euro was 0.1% lower at $1.1689, after Trump said the European Union could receive a letter on tariff rates by Friday, throwing into question the progress of Brussels' trade talks with Washington. Against the yen, the dollar was up 0.6% to 147.05 yen.
The Canadian dollar weakened against its U.S. counterpart and was down 0.2% at C$1.3687, following a knee-jerk fall of more than 0.5% after Trump unveiled the tariff rate. The Brazilian real was 0.7% lower against the dollar.
Also supporting the dollar were data suggesting labour market resilience and minutes from the Federal Reserve's latest policy meeting that tempered market expectations for imminent interest rate cuts.
The dollar index is down nearly 10% so far this year, on worries that data could soon reflect more widely the damage U.S. policies have had on the world's largest economy.
Elsewhere, sterling was down 0.5% at a two-week low at $1.3513, as data showed Britain's economy contracted unexpectedly for a second month running in May.
Cryptocurrencies saw a boost, driven by institutional investor demand and crypto-friendly U.S. policies. Bitcoin advanced 3.7% and scaled yet another record high of $118,832, while ethereum jumped 5.9% to $2,987.15.
Source: Reuters
