Dollar falls against major pairs
NEW YORK: The dollar staged a broad retreat on Thursday, as investor gloom over the lack of progress towards defusing the US-China trade war reasserted itself following an interlude of optimism the previous day.
US assets, including the dollar, rallied on Wednesday after US President Donald Trump backed down from threats to fire the head of the Federal Reserve and appeared to soften his stance on China.
Treasury Secretary Scott Bessent said separately that the de facto embargo on US-China trade was unsustainable, but that the US would not move first in lowering its levies of more than 100% on Chinese goods.
By Thursday, those dollar gains had unravelled. China said there had been no negotiations on the economy and trade and it urged the US to lift all unilateral tariff measures if it really wished to resolve the issue, leaving investors roughly where they were earlier in the week in terms of clarity.
The yen led the charge higher, leaving the dollar down 0.71% on the day at 142.395, but still above the 140-mark breached last week.
'There were hopes of a thaw in the US-driven trade dispute with absolutely everyone,' Trade Nation strategist David Morrison said.
'(Trump) softened his tone towards China, calling on them to come and negotiate. But it turns out it takes two to tango, and for now, the Chinese leadership has decided to let the Trump administration stew in its own mess,' he added.
The dollar has been the biggest casualty of Trump's on-off tariffs, dropping by 4.8% in April so far alone, which would mark its largest monthly decline since November 2022.
Investors had been shaken over the last few days when Trump made a series of verbal attacks on Fed Chair Jerome Powell over his reluctance to cut interest rates until justified by the data.
Such has been the investor pullback from the dollar that it is on course for its worst start to the year against a basket of currencies since the 1970s, according to LSEG data.
'A nascent relief rally in markets is stalling out as hopes for a thaw in the US-China trade war unravel amid contradictory signals from officials,' said Karl Schamotta, chief market strategist at Corpay, in a research note.
'The dollar is coming under selling pressure once again, Treasury yields are inching lower and equity futures are cruising toward renewed losses at the North America open.'
The Swiss franc, which is around its strongest against the dollar in more than a decade as a result of hefty safe-haven flows this month, rose, leaving the US currency down 0.58% on the day at 0.82565 francs.
The pound rose 0.53% to $1.332. UK finance minister Rachel Reeves said on Thursday she was confident Britain could reach a trade deal with the United States.
Bitcoin tracked the dollar lower, falling 0.84% on the day to $92,896. Meanwhile, Trump's meme coin surged 33% overnight after the online promotion of a gala dinner with the president for the top 220 buyers of the $TRUMP coin. It is still only worth roughly a quarter of what it was at its launch in January.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
2 hours ago
- Express Tribune
Trump deploys National Guard to LA as immigration raids spark protests
Listen to article US President Donald Trump's administration said it would deploy 2,000 National Guard troops on Saturday as federal agents in Los Angeles faced off against a few hundred demonstrators during a second day of protests following immigration raids. Defense Secretary Pete Hegseth warned that the Pentagon was prepared to mobilize active-duty troops "if violence continues" in Los Angeles, saying the Marines at nearby Camp Pendleton were "on high alert." Federal security agents on Saturday confronted protesters in the Paramount area in southeast Los Angeles, where some demonstrators displayed Mexican flags. A second protest in downtown Los Angeles on Saturday night attracted some 60 people, who chanted slogans including "ICE out of L.A.!" Trump signed a presidential memorandum to deploy the National Guard troops to "address the lawlessness that has been allowed to fester," the White House said in a statement. Trump's border czar, Tom Homan, told Fox News that the National Guard would be deployed in Los Angeles on Saturday. California Governor Gavin Newsom called the decision "purposefully inflammatory." He posted on X that Trump was deploying the National Guard "not because there is a shortage of law enforcement, but because they want a spectacle," adding: "Don't give them one. Never use violence. Speak out peacefully." Newsom said it was "deranged behavior" for Hegseth to be "threatening to deploy active-duty Marines on American soil against its own citizens." Trump posted on his Truth Social platform that if Newsom and Los Angeles Mayor Karen Bass can't do their jobs "then the Federal Government will step in and solve the problem, RIOTS & LOOTERS, the way it should be solved!!!" The protests pit Democratic-run Los Angeles, where census data suggests a significant portion of the population is Hispanic and foreign-born, against Trump's Republican White House, which has made cracking down on immigration a hallmark of his second term. Violent insurrection "Insurrectionists carrying foreign flags are attacking immigration enforcement officers, while one half of America's political leadership has decided that border enforcement is evil," Vice President JD Vance posted on X late on Saturday. Senior White House aide Stephen Miller, an immigration hardliner, described the protests as a "violent insurrection." The administration has not invoked the Insurrection Act, two U.S. officials told Reuters on condition of anonymity. One said that National Guard troops can deploy quickly, within 24 hours in some cases, and that the military was working to source the 2,000 troops. The 1807 law empowers a president to deploy the U.S. military to enforce the law and suppress events like civil disorder. The last time it was invoked was during the 1992 Los Angeles riots at the request of the California governor. Video footage of the Paramount protest showed dozens of green-uniformed security personnel with gas masks at the Paramount protest, lined up on a road strewn with overturned shopping carts as small canisters exploded into gas clouds. Authorities began detaining some protesters, according to Reuters witnesses. Los Angeles police posted on X that "multiple people have been detained for failing to disperse after multiple warnings were issued." It did not give further details. There was no official information of any arrests. "Now they know that they cannot go to anywhere in this country where our people are, and try to kidnap our workers, our people - they cannot do that without an organized and fierce resistance," said protester Ron Gochez, 44. A first round of protests kicked off on Friday night after Immigration and Customs Enforcement agents conducted enforcement operations in the city and arrested at least 44 people on alleged immigration violations. The Department of Homeland Security said in a statement that there were about "1,000 rioters" at the protests on Friday. Reuters could not verify DHS's account. Angelica Salas, executive director of immigrants' rights organization Chirla, said lawyers had not had access to those detained on Friday, which she called "very worrying." Trump's immigration crackdown Trump has pledged to deport record numbers of people in the country illegally and lock down the US -Mexico border, with the White House setting a goal for ICE to arrest at least 3,000 migrants per day. But the sweeping immigration crackdown has also caught up people legally residing in the country, including some with permanent residence, and has led to legal challenges. ICE, the Department of Homeland Security, and the Los Angeles Police Department did not respond to requests for comment on the protests or whether there had been any immigration raids on Saturday. Television news footage on Friday showed unmarked vehicles resembling military transport and vans loaded with uniformed federal agents streaming through Los Angeles streets as part of the immigration enforcement operation. Raids occurred around Home Depot stores, where street vendors and day laborers were picked up, as well as at a garment factory and a warehouse, Salas of Chirla said. Bass, the mayor of Los Angeles, condemned the immigration raids. "I am deeply angered by what has taken place," Bass said in a statement. "These tactics sow terror in our communities and disrupt basic principles of safety in our city. We will not stand for this."
Business Recorder
3 hours ago
- Business Recorder
Rwanda quits Central African bloc in dispute with Congo
KIGALI: Rwanda has said it would withdraw from the Economic Community of Central African States (ECCAS), underscoring diplomatic tensions in the region over an offensive this year by Rwanda-backed M23 rebels in eastern Congo. Kigali had expected to assume the chairmanship of the 11-member bloc at a meeting on Saturday in Equatorial Guinea. Instead, the bloc kept Equatorial Guinea in the role, which Rwanda's foreign ministry denounced as a violation of its rights. Rwanda, in a statement, condemned Congo's 'instrumentalization' of the bloc and saw 'no justification for remaining in an organization whose current functioning runs counter to its founding principles.' It wasn't clear if Rwanda's exit from the bloc would take immediate effect. The office of Congolese President Felix Tshisekedi said in a statement that ECCAS members had 'acknowledged the aggression against the Democratic Republic of Congo by Rwanda and ordered the aggressor country to withdraw its troops from Congolese soil.' M23 seized eastern Congo's two largest cities earlier this year, with the advance leaving thousands dead and raising concerns of an all-out regional war. African leaders along with Washington and Doha have been trying to broker a peace deal. Congo, the U.N. and Western powers accuse Rwanda of supporting M23 by sending troops and weapons. At least 143 dead in DR Congo boat fire Rwanda has long denied helping M23, saying its forces were acting in self-defence against Congo's army and ethnic Hutu militiamen linked to the 1994 Rwandan genocide that killed around 1 million people, mostly ethnic Tutsis. U.S. President Donald Trump's administration hopes to strike a peace accord between Congo and Rwanda that would also facilitate billions in Western investment in the region, which is rich in minerals including tantalum, gold, cobalt, copper and lithium. ECCAS was established in the 1980s to foster cooperation in areas like security and economic affairs among its member states.
Business Recorder
4 hours ago
- Business Recorder
Trump says Musk relationship over, warns of ‘serious consequences' if he funds Democrats
BEDMINSTER: Donald Trump said on Saturday his relationship with his billionaire donor Elon Musk is over and warned there would be 'serious consequences' if Musk funds U.S. Democrats running against Republicans who vote for the president's sweeping tax and spending bill. In a telephone interview with NBC News, Trump declined to say what those consequences would be, and went on to add that he had not had discussions about whether to investigate Musk. Asked if he thought his relationship with the Tesla and SpaceX CEO was over, Trump said, 'I would assume so, yeah.' 'No,' Trump told NBC when asked if he had any desire to repair his relationship with Musk. 'I have no intention of speaking to him,' Trump said. However, Trump said he had not thought about terminating U.S. government contracts with Musk's StarLink satellite internet or SpaceX rocket launch companies. Trump deploys National Guard as Los Angeles protests against immigration agents continue Musk and Trump began exchanging insults this week, as Musk denounced Trump's bill as a 'disgusting abomination.' Musk's opposition to the measure complicated efforts to pass the legislation in Congress, where Republicans hold only slim majorities in the House of Representatives and Senate. The bill narrowly passed the House last month and is now before the Senate, where Trump's fellow Republicans are considering making changes. Nonpartisan analysts estimate the measure would add $2.4 trillion to the $36.2 trillion U.S. debt over 10 years, which worries many lawmakers, including some Republicans who are fiscal hawks. Musk also declared it was time for a new political party in the United States 'to represent the 80% in the middle!' Trump said on Saturday he is confident the bill would get passed by the U.S. July 4 Independence Day holiday. 'In fact, yeah, people that were, were going to vote for it are now enthusiastically going to vote for it, and we expect it to pass,' Trump told NBC. Republicans have strongly backed Trump's initiatives since he began his second term as president on January 20. While some Republican lawmakers have made comments to the news media expressing concern about some of Trump's choices, they have yet to vote down any of his policies or nominations. Deleted Musk Posts Musk has deleted some social media posts critical of Trump, including one that signaled support for impeaching the president, appearing to seek a de-escalation of their public feud, which exploded on Thursday. During his first term as president, the House, then controlled by Democrats, twice voted to impeach Trump but the Senate both times acquitted him. The White House and Musk did not immediately respond to requests for comment on Saturday on the deleted posts. People who have spoken to Musk said his anger has begun to recede and they thought he would want to repair his relationship with Trump. One of the X posts that Musk appeared to have deleted was a response to another user posting: 'President vs Elon. Who wins? My money's on Elon. Trump should be impeached and (Vice President) JD Vance should replace him.' Musk had written 'yes.' On Theo Von's 'This Past Weekend' podcast - recorded on Thursday as the feud between Trump and Musk unfolded and released on Saturday - Vance called Musk's criticism of Trump a 'huge mistake.' 'I'm always going to be loyal to the president, and I hope that eventually Elon kind of comes back into the fold. Maybe that's not possible now because he's gone so nuclear. But I hope it is,' said Vance, describing Musk as an 'incredible entrepreneur.' Trump is due to attend an Ultimate Fighting Championship fight card on Saturday in New Jersey. Since his second election win, he has attended two previous UFC mixed martial arts fight cards with Musk. Musk is not expected to attend on Saturday. Trump says 'very disappointed' by Musk criticism Musk, the world's richest man, bankrolled a large part of Trump's 2024 presidential campaign, spending nearly $300 million in last year's U.S. elections and taking credit for Republicans retaining a majority of seats in the House and retaking a majority in the Senate. Trump named Musk to head an effort to downsize the federal workforce and slash spending, lauding him at the White House only about a week ago for his work as head of the Department of Government Efficiency. Musk cut only about half of 1% of total spending, far short of his brash plans to axe $2 trillion from the federal budget.
