Daily Morning Report 21.05.2018

The dollar opened the week rallying against the other major currencies in Asia, climbing to a fresh new high this year. Risk appetite revived as the trade war between the world’s two biggest economies is put “on hold”.

U.S. Treasury Secretary Steven Mnuchin said on Sunday that the trade war with China is now put on hold. “We are putting the trade war on hold. Right now, we have agreed to put the tariffs on hold while we try to execute the framework,” Mnuchin said.

The dollar picked up as China and the U.S. agreed to halt imposing punitive import tariffs. Chinese and American negotiators set up a framework to address the trade imbalances.

The USDJPY pair added 0.40% to 111.21. As fears of the trade war faded, investors turned to riskier assets such as equities, which weighed down the safe-haven yen.

Elsewhere, the AUDUSD pair added 0.15% at 0.7521. Australia will see a light data week, except releasing its construction work done figures on Wednesday.