The U.S. dollar slipped back Friday, handing back some of the previous session’s strong gains ahead of monthly retail sales data and a meeting between U.S. President Donald Trump and Russian President Vladimir Putin.
At 04:15 ET (08:15 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.4% lower at 97.750, after sharp gains the prior session.
Repricing of Fed expectations
Trump and Putin are set to hold talks in Alaska later in the session to try and negotiate an end to the war in Ukraine - a conflict that has raged for over three years, and has severely disrupted the global supply chain, resulting in inflated commodity prices and a substantial hit to global growth.
“Trump has defined this as a ‘feel-out’ meeting and said there will likely be talks with European allies and Ukraine after this summit,” said analysts at ING, in a note. “This suggests that while we could see some draft plan for a ceasefire tonight, markets may treat it with some caution.”
“Trump has also said there is a “25%” chance nothing will be agreed today. That would be the most bullish scenario for the dollar, which could otherwise still come under a bit more pressure from geopolitical risk unwinding.”
While the meeting in Alaska could be a turning point for the Ukraine conflict, it’s unlikely to have the impact on the dollar that macroeconomic data has of late.
The U.S. dollar slipped back Friday, handing back some of the previous session’s strong gains ahead of monthly retail sales data and a meeting between U.S. President Donald Trump and Russian President Vladimir Putin.
At 04:15 ET (08:15 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.4% lower at 97.750, after sharp gains the prior session.
Repricing of Fed expectations
Trump and Putin are set to hold talks in Alaska later in the session to try and negotiate an end to the war in Ukraine - a conflict that has raged for over three years, and has severely disrupted the global supply chain, resulting in inflated commodity prices and a substantial hit to global growth.
“Trump has defined this as a ‘feel-out’ meeting and said there will likely be talks with European allies and Ukraine after this summit,” said analysts at ING, in a note. “This suggests that while we could see some draft plan for a ceasefire tonight, markets may treat it with some caution.”
“Trump has also said there is a “25%” chance nothing will be agreed today. That would be the most bullish scenario for the dollar, which could otherwise still come under a bit more pressure from geopolitical risk unwinding.”
While the meeting in Alaska could be a turning point for the Ukraine conflict, it’s unlikely to have the impact on the dollar that macroeconomic data has of late.
USD/CNY rose 0.1% to 7.1833, with the yuan slipping slightly after data showed that Chinese industrial production in July fell short of expectations as overseas demand waned following earlier front-loading due to U.S. tariffs.
Retail sales figures from the world’s second-largest economy also came in below expectations in July amid weakness in consumer spending.
AUD/USD gained 0.4% to 0.6514, with the Aussie dollar bouncing after the previous session’s losses.
Source :
https://www.investing.com/news/forex-news/dollar-hands-back-some-gains-ahead-of-trumpputin-summit-4194649
