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Wednesday May 18, 2022

Dollar strengthens

By REUTERS
August 04, 2018

LONDON: The dollar rose for a fourth straight day on Friday, benefiting from turbulence caused by an escalating U.S.-China trade conflict, as investors prepared for a U.S. jobs report due later in the day.

China has said it will retaliate if U.S. President Donald Trump follows through on a threat to increase tariffs to 25 percent from 10 percent on $200 billion in Chinese imports.

Worries about the impact that tariffs would have on growth spread from Asian to European markets yesterday, where equity markets tumbled.

The euro on Friday fell to a five-week low of $1.1577 as the dollar rallied.

China´s offshore yuan, which has been under pressure on worries the months-long trade dispute will hurt its economy, slid a further 0.4 percent to as low as 6.9064 yuan, its weakest since May 2017. "The strength of the U.S. dollar is likely to continue as we look ahead to the prospect of another two rate rises by year- end, along with some haven flows over the trade war escalation," said Michael Hewson, chief analyst at CMC Markets. Others warned, though, that the dollar´s nearly eight percent rise since February might not be sustainable.

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