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Dollar Surges After US And China Agree To Reduce

by changzheng51

The US and China have reached an agreement to temporarily reduce tariffs for 90 days. This move has led to a significant reaction in the financial markets. The dollar saw a sharp increase in value, while government bonds were sold off.

US – China Tariff Truce Sends Dollar Soaring

A measure of the dollar’s strength climbed by as much as 0.8%. The yen, which is usually considered a safe – haven currency, dropped sharply. The progress in the trade talks has increased investors’ appetite for risk across various asset classes. Consequently, the yield on the US 10 – year Treasury note rose by six basis points to 4.43%. Valentin Marinov, the head of G10 FX strategy at Credit Agricole SA, commented, “This is positive for G10 risk, especially the Antipodean currencies and the US dollar. Easing concerns about US growth should further boost market confidence in assets denominated in US dollars.”

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How It’s Fueling the Dollar’s Surge

After weekend negotiations in Geneva, the US and China issued a joint statement, confirming that they would lower tariffs on each other’s goods for a temporary period.

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