The yen plumbed an eight-month low while the yuan climbed to its highest level s...
In contrast, the offshore yuan traded at 6.881 yuan per dollar“Washington’s decision to lift its designation of currency manipulator on China has added to the positive mood that has been already in place ahead of the signing of the trade deal,” said Minori Uchida, chief currency strategist at MUFG Bank.
But Uchida also said the dollar/yen is likely to face an uphill battle beyond the 110 yen mark, because the dollar is already expensive relative to the U.S.-Japan yield gap which it tracks fairly closely. “The main driver of the dollar/yen is the yield gap. Last year, when the dollar was above 110 yen, the yield gap was about 2.4 percentage points. Right now it is about 1.8-1.9 percentage points. And we could see a setback if the upcoming trade deal does not go beyond what has been already reported,” he added.The European common currency, on a recovery after hitting a two-week low of $1.10855 on Friday, last traded at $1.
The Australian dollar was lethargic, struggling to get any lift from upbeat economic data of late, as weeks of bushfires have darkened the mood toward the economy.
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