Dollar near one-month highs before Fed minutes; pound dives | The Daily Star
12:00 AM, May 23, 2019 / LAST MODIFIED: 01:06 AM, May 23, 2019

Dollar near one-month highs before Fed minutes; pound dives

The dollar largely kept to familiar trading ranges on Wednesday, as it found support near a 3-1/2-week high on higher US yields after the United States eased trade restrictions on Chinese telecommunications equipment maker Huawei Technologies.

The move came as a relief to markets hit by escalating trade tensions between the United States and China, though analysts said sentiment remained fragile with tariff negotiations between the world’s two largest economies yet to produce a durable solution.

“The trade dispute won’t be resolved easily, so the risk-off mood won’t come off all of a sudden, said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank. “I think market sentiment will rather improve one small step at a time.”  Against a basket of key rival currencies, the dollar was largely steady at 98.031, having brushed a 3-1/2-week high of 98.134 overnight. The index has risen 1.9 percent this year.

The US Commerce Department blocked Huawei Technologies Co Ltd from buying US goods last week, leading several companies to suspend business with the world’s largest telecoms equipment maker.

Chipmakers, many of which sell to Huawei, bore the brunt of the sell-off. But late on Monday, the United States granted Huawei a licence to buy US goods until Aug. 19.

Against the yen, the dollar was largely steady at 110.49 yen, after hitting a two-week high of 110.675 during the previous session. The greenback has recovered 1.4 percent from a three-month trough of 109.02 yen touched on May 13.

Japan’s exports fell 2.4 percent in April from a year earlier, down for a fifth straight month, in a sign of weakness in external demand, finance ministry data showed.

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