The dollar achieves the first weekly gains while calming the trade war

The US dollar has achieved its first weekly gains since mid -March, supported by positive signals from China to reduce trade tensions with the United States.
Despite the continued ambiguity, analysts see preliminary indicators to calm the trade conflict between the two largest economies in the world.

Calm the trade war pushes the US dollar to rise

In a related context, the US dollar has tended to record its first weekly gain since mid -March, with the support of the customs exemptions that China granted to American imports.
This measure has sparked widespread hopes that the trade war between the United States and China may approach its end, according to the newspaper “The Economic Times”.

At the same time, the dollar was subjected to strong pressure recently as a result of conflicting signals on improving trade relations between Washington and Beijing.
For his part, US President Donald Trump indicated that direct talks with China are ongoing, expressing his optimism to calm the conflict.

According to corporate reports, China gave 125% customs exemptions on some American products, asking companies to determine the goods qualified for these exemptions.
In an interview with “Time” magazine, Trump confirmed that Chinese President Xi Jinping was contacting him directly, despite Beijing continued to question the description of the United States for these talks.

The US dollar has made the first weekly gains since March

In light of these developments, the US dollar increased by 0.07% against a basket of global currencies, making the first weekly gain since mid -March.
According to Fiona Cinnokota, a City Index market expert, the situation is still vague, but indicates that the commercial escalation has stopped significantly, with preliminary indicators to calm the situation.

However, despite these positive developments, it has not yet been clear whether customs exemptions are sufficient to reflect the flows of investors outside the US dollar, which fell 4% since Trump announced the definitions of “Liberation Day”.

“We have seen some decline from the peak areas of the sale, but it is too early to declare a real recovery of the dollar at the current stage.”

The rise of the US dollar amid the decline in safe havens

In the same context, the US dollar increased by 0.67% against the Japanese yen to 143,555 yen, and increased by 0.09% against the Swiss franc to 0.827 Swiss francs.

On the other hand, the euro fell 0.11% to $ 1.1377, and the pound fell 0.1% to $ 1.3325, despite the registration of retail sales in Britain strong numbers during the recent period.

How did Trump’s comments affect the movements of the US dollar?

On the other hand, the US dollar witnessed a decline against the main currencies after Trump’s threats to dismiss the Federal Reserve Chairman Jerome Powell due to the slow pace of reducing interest rates.

However, the dollar returned again after Trump’s statements that it does not actually intend to replace the head of the Central Bank, which reduced market concerns about monetary stability in the United States.

Commercial negotiations between America, South Korea and Japan .. What happens?

On the other hand, the United States has made progress in early commercial talks with both South Korea and Japan, according to official statements from both sides.

After his meeting with US Treasury Secretary Scott Besent, Japanese Finance Minister Katsunobo Kato confirmed that currency issues were not discussed during the meeting, despite the accusations of the Trump administration previously to Tokyo of manipulating its currency price to support its exports.

It is expected that the chief Japanese negotiator, Riosi Akazawa, will hold a second round of talks with Pesent this week, with the aim of strengthening economic relations between the two countries.

Is diluting fees sufficient to support global economic growth?

Despite the positive news about reducing customs duties, Derek Halini, a strategic expert at MUFG, warned that this measure does not necessarily mean an immediate improvement of American economic growth.

Halbini added that the levels of volatility will remain high, expecting the pressure on stock markets to continue, which may weaken the chances of achieving a sustainable recovery of the dollar in front of the Japanese yen.

Bank of Japan monitors the impact of the trade war on the economy

In a relevant development, the Governor of the Bank of Japan, Kazo Oida, affirmed the bank’s commitment to accurately monitoring the basic inflation levels, with preparedness to raise interest rates if inflation is approaching to achieve a goal of 2%.

Oida pointed out that the American customs duties may negatively affect the economic growth in Japan, stressing that the central bank will keep interest rates unchanged in its end meeting on May 1.