Asian currencies traded with limited movement as investors weighed the potential for less strict trade tariffs under incoming U.S. President Donald Trump. The dollar stabilized after recent losses, fueled by speculation about Trump's tariff plans. The Chinese yuan remained under pressure, hitting its weakest level in 17 years, due to new U.S. restrictions on Chinese companies and rising trade tensions.
Most Asian currencies traded in a narrow range on Tuesday as investors assessed the potential for less stringent trade tariffs under incoming U.S. President Donald Trump , while the dollar stabilized after recent losses. The Chinese yuan continued to underperform its counterparts after hitting a 17-year low on Monday. Although it recovered slightly, it remained vulnerable, pressured further by new U.S. restrictions on Chinese companies.
The dollar also recovered a significant portion of its overnight decline following a report that fueled speculation about the specifics of Trump's tariff plans. The greenback recouped most of its Monday losses after Trump refuted a Washington Post article stating his administration would implement less severe trade tariffs than initially proposed. Trump, who is scheduled to take office in less than two weeks, has pledged to impose hefty import tariffs on China and other major economies, raising concerns about a resurgence of global trade wars. The prospect of increased tariffs has been a key factor driving the dollar's recent surge, alongside growing confidence that the Federal Reserve will slow its interest rate cuts in 2025. Hawkish comments from Fed officials over the weekend reinforced this view. The Chinese yuan was the worst-performing Asian currency this week, having touched its weakest level in 17 years on Monday. The yuan is facing additional pressure from the U.S. government adding Chinese companies with ties to the military to a blacklist, threatening to further strain relations between the world's two largest economies. Beijing is anticipated to implement even more stimulus measures in response to a renewed trade war with the U.S
TRADE WAR ASIAN CURRENCIES US DOLLAR DONALD TRUMP CHINA
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