Dollar continues slide as yuan strengthens and GBP finds support
Investing.com
Published Dec 29, 2019 11:08PM ET
Investing.com - The U.S. dollar continued to retreat on Monday morning in Asia, with the greenback sliding for the third day in a row.
The U.S. dollar index was down 0.17% to 96.75 by 10:30 PM ET (03:30 GMT).
The dollar lost ground against most currencies in the region with relatively thin trading ahead of the New Year Holiday on Wednesday.
The AUD/USD pair was up 0.24% to 0.6994 and the NZD/USD was up 0.27% to 0.6716.
The USD/JPY pair was down 0.28% to 109.10 with the Japanese currency set to finish 2019 roughly on par to where it started.
The People’s Bank of China set the reference rate of the yuan at 6.9805, stronger than the 6.9879 fix set on Friday as the yuan continues to strengthen from five months highs.
China’s official Purchasing Managers’ Index (PMI) is due to be released on Tuesday followed on Thursday by the Caixin PMI, both of which will give some indication of the state of the Chinese economy.
Over the weekend, the PBOC ordered the adoption of a new approach to pricing loans. Lenders will be expected to move towards a new loan prime rate (LPR) starting January 1. The LPR is set at 4.15% for a one-year loan, lower than the current benchmark of 4.35%.
Meanwhile, markets continue to look forward to the signing of a phase one trade deal between the U.S. and China but are also looking for any spike in tensions in the Korean peninsula, particularly any missile tests in North Korea around the New Year.
The GBP/USD was up 0.30% to 1.3115, with the pound finding some support after the Ursula von der Leyen, the president of the European Commission, said the EU may need to extend the deadline for Brexit talks.
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