USD/JPY Turns Bullish Over Trump’s Promising Remarks on US-China “Phase 1” Trade Deal

Arslan Butt•Tuesday, October 29, 2019•1 min read

On Tuesday, the US dollar is trading steady after gaining against the safe haven Japanese yen on hopes for the interim trade deal between the US and China which could work towards resolving the trade war. At the time of writing, USD/JPY is trading at around 108.97.

US President Donald Trump hinted that the Phase 1 trade deal could be signed ahead of schedule as it was close to being finalized. This helped strengthen the US dollar as markets turned hopeful that the US and China were serious about making progress and bringing about an end to a trade war that has dragged on for more than a year.

In addition, the US Trade Representative’s office also commented that the US could exempt some tariffs on $34 billion worth of Chinese imports as a goodwill gesture as trade negotiations progress. The US government had previously exempted around 1,000 goods from tariffs rolled out in July 2018. This exemption is due to expire in December, but could get further extended if the trade deal gets finalized.

However, the US dollar’s gains remained subdued as traders focus their attention towards the upcoming Fed monetary policy meeting in anticipation of a rate cut announcement. Markets are widely expecting the Fed to announce one more rate cut to support weak data releases and weakening inflation in the US economy.

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.