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Dollar Slides; Aussie Drops on Weak Surplus Data

6/7/2018, 2:07:52 PMBasics of Trading
Dollar Slides; Aussie Drops on Weak Surplus Data

The dollar slid in morning trade in Asia Thursday, staying on the bearish track from the previous day. The Aussie was also losing ground to the dollar after Australia reported a weaker-than-expected April trade surplus.

The U.S. dollar index lost 0.12% to 93.50 by11:50PM ET (03:50 GMT). The dollar index is designed to track the greenback against a basket of six major currencies.

Weighing on the dollar is the lingering likelihood of a full-blown trade war with the U.S. as its center. Mexico announced Wednesday it was imposing $3 billion in tariffs on U.S. imports in response to the latter's triggering duties on steel and aluminum last Thursday.

Markets are now looking ahead to the Group of Seven (G7) on June 8 and 9 in Quebec, Canada. U.S. President Donald Trump plans to meet his Canadian and French counterparts at the summit to discuss trade issues.

Meanwhile, Australia’s trade surplus shrunk more than expected in April to AUD977 million from a March surplus of AUD1.73 billion official data showed on Thursday. The news set the Aussie back, with the AUD/USD pair easing 0.25% to 0.7650. 

Elsewhere in Asia, Japanese Prime Minister Shinzo Abe was set to meet with U.S. President Donald Trump on Thursday and Friday at the White House to discuss a planned U.S. summit with North Korean leader Kim Jong Un next week.

In Japan, the yen gained against the dollar. The USD/JPY pair lost 0.15% to 110.01.

In China, the USD/CNY pair added 0.06% to trade at 6.3923.  The People's Bank of China set the set the reference rate for the yuan against the dollar, the mid-point from which the currency is allowed to trade, at 6.3919 versus the previous day's 6.4040