US dollar fluctuates amid US-China trade uncertainty

Pound (GBP) bolstered by trade deal optimism

The pound (GBP) closed last week’s session on a positive note, amid growing economic optimism in the UK.

This followed the recent announcement of new trade deals with India and the US, as well as hopes for a new agreement with the EU to be signed later this month.

GBP investors will look to a series of speeches by Bank of England (BoE) policymakers for fresh impetus today. A broadly hawkish outlook could help propel Sterling higher.

Euro (EUR) supported by USD weakness

The euro (EUR) trended broadly higher on Friday, as it was underpinned by its strong negative correlation with the US dollar (USD).

EUR sentiment was also buoyed by hopes for a more united Europe, following the announcement of a new Franco-Polish treaty.

Notable Eurozone economic data is also in short supply at the start of this week, which may leave the euro directionless today.

US dollar (USD) shaken by trade uncertainty

The US dollar faced headwinds at the end of last week, with USD investors wary ahead of trade talks between the US and China over the weekend.

This caution was in part driven by comments from President Donald Trump, who suggested that an ‘80% tariff on China seems right’, disappointing markets that had hoped they could be reduced to at least 60%.

An announcement from the White House that a trade deal has been struck with China could help underpin the US dollar today, although USD investors are waiting for more details before placing any bullish bets.

Canadian dollar (CAD) slides as unemployment rises

The Canadian dollar (CAD) also stumbled on Friday, as Canada’s latest jobs report revealed unemployment jumped to 6.9% in April as Trump’s tariffs began to take their toll.

If oil prices continue their recent recovery today, it may pave the way for the commodity-linked ‘loonie’ to regain lost ground at the start of this week.

Australian dollar (AUD) bolstered by trade deal optimism

The Australian dollar (AUD) firmed through the start of this week’s session as reports of a US-China trade deal reflected positively on the ‘Aussie’.

New Zealand dollar (NZD) firms in risk-positive trade

The New Zealand dollar (NZD) also strengthened in overnight trade as hopes for a US-China trade agreement helped to cheer markets.

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