US dollar dips as tariff worries resurface

Written by Iqbal Ahmed

(Reuters) – The US dollar fell in all fields on Monday, as it gave up the gains of the previous week, as the markets weighing the expectations of President Donald Trump’s policy and its ability to harm growth and inflation.

The US currency fell after Trump said on Friday that he intends to double the duties on imported steel and aluminum to 50 % starting from Wednesday, and with Beijing fell against accusations, he violated an agreement on critical mineral shipments.

The China Ministry of Commerce said on Monday that the charges were “baseless”, and promised to take strong and unlimited measures to protect its interests. “This will be heated.”

Michael Brown, a market analyst at Pepperstone in London, noted that the pressure on the dollar was widely.

Brown said: “Anytime we see a return to concerns related to tariffs, everyone begins to return to the” sale of America “again,” Brown said.

The dollar fell 0.8 % to 142.85 yen, which almost earns it against the Japanese currency last week.

The euro rose 0.8 % to $ 1.14355 – the highest level since late April. Later in the week, the focus will be on the interest rate of the European Central Bank and subsequent expectations.

The dollar extended its losses after the data showed us manufacturing for a third month in a row in May, and the suppliers took longer to submit the inputs amid a tariff, which is likely to indicate a shortage of some commodities.

Earlier in the session, the data showed that European manufacturing took another step towards stability in May, but the activity of the Asian factory decreased.

The dollar index, which measures its performance against six other major currencies, decreased by 0.6 % and 98.75 was shy at the lowest level of three years from 97.923 in late April.

The American currency has been skipped for weeks by Trump’s trade war, and investors were questioning the settlement of the currency safe as a scene in tensions that raise fears of stagnation in the potential United States.

“We expect the US dollar to continue (over the next 12 months) thanks to the rapprochement of both American rates and growth of peers,” strategic experts in Morgan Stanley said in a note on Sunday.

Last week, the dollar got some rest, as it rose 0.3 % after commercial talks with the European Union returned to the right track and a US commercial court banned the largest part of the Trump tariff on the basis that it exceeded his authority.