Yen Rises Amid Renewed China-U.S. Tensions; U.S. Dollar Slips
The safe-haven yen rose on Friday in Asia following reports that U.S. President Trump is considering to ban U.S. companies from using equipment made by China’s Huawei and ZTE (HK:0763).
"With the end of 90-day tariff moratorium looming ominously on the horizon, this announcement is yet another bump in the rocky path to a trade resolution," said Stephen Innes, head of Asian trading at Oanda.
The news came one day after Bloomberg said China and U.S. are set to resume trade talks in early January. Washington and Beijing earlier this month agreed to a 90-day ceasefire in their tariff dispute.
The USD/JPY pair traded 0.4% to 110.61 following the news, while the U.S. dollar index slipped 0.1% to 95.917.
Meanwhile, the USD/CNY pair fell 0.2% to 6.8565 as the People's Bank of China (PBoC) has set the yuan reference rate for today's markets at 6.8632, versus yesterday's rate of 6.8894.
On Thursday, official data showed China’s industrial profits fell for the first time since December 2015.
The decline was due to slowing growth in sales and producer prices, and rising costs, He ping of the statistics bureau said in a statement accompanying the data, while analysts noted rising trade tensions with the United States also piled pressure on China’s economic growth.