The dollar rebounded from 16-month lows against the yen on Monday as fears over a possible trade war between the U.S. and China eased following reports that the two sides were attempting to resolve the issue behind the scenes.
USD/JPY was up 0.33% to 105.08 by 03:50 AM ET (07:50 AM GMT) after falling to 104.62 overnight, the weakest level since November 2016.
The Wall Street Journal reported Monday that Beijing and Washington were negotiating to improve U.S. access to Chinese markets, after a week of threats to use trade tariffs.
The report saw the safe haven yen turn lower and U.S. stock futures rebound as investor sentiment recovered.
Fears over the prospect of a trade war between the world’s two largest economies sparked a wave of risk aversion, sending Wall Street tumbling on Friday.
The euro moved higher against the dollar, with EUR/USD rising 0.26% to 1.2385.
The pound was also higher, with GBP/USD climbing 0.35% to 1.4179.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.17% to a one-month low of 88.95.
The Australian dollar was higher, with AUD/USD up 0.48% to 0.7736. China is a major destination for Australian exports.
The trade-related New Zealand and Canadian dollars were also stronger, with NZD/USD last at 0.7283 and USD/CAD most recently at 1.2851.