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Sunday, September 27th, 2020

Asian markets mixed as dollar retreats on Trump comments

by April 14, 2017 General

Hong Kong: Asian markets were mixed on Thursday, with the dollar in retreat as US President Donald Trump voiced fears about a strong greenback and softened his stance on Beijing, easing concerns of a possible trade war. Geopolitical tensions also continued to weigh on investor sentiment, as ties between the US and Russia turn increasingly frosty over Moscow’s backing for Syrian President Bashar al-Assad.
But Trump’s praise for Chinese President Xi Jinping on Wednesday raised hopes of easing friction between the two superpowers over dealing with North Korea’s nuclear programme.
And a surge in Chinese exports in March, the largest jump in two years, bolstered hopes that the world’s number two economy is getting back on track after a recent slowdown — it grew last year at its slowest pace in a quarter of a century.
The dollar slid after Trump told The Wall Street Journal that he was worried about its strength and said he favoured low interest rates.
“I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me. But that’s hurting — that will hurt ultimately,” Trump told the paper.
Trump also reversed course on an earlier vow to label Beijing a currency manipulator and slap punitive tariffs on Chinese imports.
China for years was accused of keeping its currency artificially low to make its exports cheaper and more competitive compared to US goods.
“They’re not currency manipulators,” Trump said in the interview.
He went out of his way to praise Xi, saying he was “very impressed” following a meeting between the two leaders in Florida last week.
“I think we had a very good chemistry together. I think he wants to help us with North Korea,” Trump said in a Wednesday press conference.
The yen, seen as a safe-haven investment during times of uncertainty, jumped against the greenback following Trump’s interview.
Tokyo ended the day 0.6 per cent lower while Sydney lost 0.7 per cent. Hong Kong dipped 0.2 per cent and Singapore fell 0.5 per cent.
Shanghai inched up less than 0.1 per cent, eking out thin gains after the release of stronger trade figures for March brightened the economic outlook, with a 16.4 per cent jump in exports year-on-year marking a dramatic turnaround from the 1.3 per cent year-on-year drop recorded in February.
A pickup in external demand, surging import prices, and a stable domestic economy boosted the figures, China’s government said.
The stronger yen hit exporters with Toyota falling 1.15 per cent while smaller rival Mitsubishi Motors lost 2.45 per cent.
Toshiba dropped 5.01 per cent as speculation swirls over its plan to sell a prized memory chip unit to plug huge losses.
Jeffrey Halley, senior market analyst at forex firm OANDA, said investors would continue to pursue safe-haven options.
“Safe havens reign supreme with precious metals and US bonds rallying hard overnight…. Expect investors to continue to seek safe harbours as we head into the long weekend,” Halley said in a note. — AFP

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