The dollar continued to slide in Asia on Wednesday morning as another resignation from Trump’s White House strengthened the pro-tariff forces and hurt investors’ confidence in the greenback.
The US dollar index that tracks the greenback against a basket of six major currencies slipped 0.09% to 89.48 at 10:30pm ET. The dollar turned bearish since US President Trump’s tough tariff plan last week and the decline extended to this week, with no sign of picking up.
Gary Cohn, Trump’s top economic advisor, is leaving the Trump administration due to disputes over the president’s tariff plan. The White House also said it was considering to impose wider curbs on China and clamp down on Chinese investments in the US. Investors suspected Trump’s protectionism may result in a weaker dollar that stimulates exports and high tariffs that curb imports. Fears of a global trade war revived following Cohn’s resignation.
The softer dollar supported the appreciation of the yen, with the USD/JPY pair sliding 0.44% to 105.67. The safe-haven currency gained grounds as signals were mixed whether Trump would translate his tariff plans into policy. Eyes will be on Japan’s Q4 GDP data that are due tomorrow morning.
The AUD/USD pair traded 0.36% lower at 0.7801. The Aussie remained soft on Reserve Bank of Australia’s dovish monetary policy that is holding the rates well into 2019. Australia’s GDP growth of the fourth quarter in 2017 missed forecast of 0.5% quarter-on-quarter to come at 0.4% instead.
Elsewhere, The People’s Bank of China set the fix rate of yuan against the dollar at 6.3294 versus yesterday’s 6.3386. The USD/CNY pair was quoted at 6.3276, up 0.29%.