U.S. Dollar Little Changed; Yuan Slips on Weak Trade Data
The U.S. dollar was little changed, while the Chinese yuan slipped after data showed the country’s exports shrank the most in 2 years in December.
The U.S. dollar index that tracks the greenback against a basket of other currencies slipped 0.07% to 95.195.
This week investors will be looking ahead to Tuesday’s data on U.S. producer price inflation as they continue to gauge the outlook for policy tightening by the Federal Reserve this year.
“The outlook for relative central bank policy has reached its climax in terms of offering the U.S. dollar support, and widening fiscal and current account deficits are expected to deliver medium-term weakness in the currency,” said Shaun Osborne, chief FX strategist, at Scotiabank in Toronto.
Data on Friday showed that U.S. consumer prices in December fell for the first time in nine months in December, although it seemed to had little impact on the market.
Meanwhile, the USD/CNY pair edged up 0.1% to 6.7674. Data on Monday showed China’s exports in December unexpectedly fell 4.4% from a year earlier, while imports also dipped 7.6% in their biggest since July 2016.
China exports to the U.S. slid 3.5% in December while its imports from the U.S. were down 35.8% for the month, the data revealed.
The People's Bank of China (PBOC) set the yuan reference rate at 6.7560 vs Friday's fix of 6.7909.
Elsewhere, the USD/JPY pair was down 0.4% to 108.12.
The AUD/USD pair and the NZD/USD pair were both 0.5% lower.