Global Forex Market

THE dollar’s strength was broad-based, supported by safe-haven play after President Donald Trump tweeted about raising current tariffs from 10% to 25% on US$200bil worth of Chinese imports and accused the Chinese of backpedalling on trade talks. However, the US dollar erased its weekly gains after April core producer prices unexpectedly edged lower to 0.1% month-on-month (m-o-m) from 0.3% m-o-m in March (consensus: 0.2%).

As such, we saw the US dollar weakened 0.15% to 97.4 from 97.5 over the week. Meanwhile, the Dow Jones and S&P500 lost 2.3% and 2.1% to 25,828 and 2,871, respectively, amid the rising trade tension.

In the commodity market, the Brent plunged 1.19% to US$70.4 per barrel as the ongoing trade tension could hurt global oil demand. However, the rising tension between the US and Iran had partially cushioned the decline in oil prices with the US increasing its military involvement in Middle East and the new sanctions on metal.

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