Markets focused on trade negotiations between the United States and China. According to a Reuters poll conducted last week, any aggravation of the trade conflict between the two largest economies in the world could lead to a sharp decline in the global economy. While China has indicated its willingness to buy more goods from the United States, sources say both sides remain "far apart" on key structural issues, and Washington threatens to raise tariffs if it does not see significant progress in improving relations before the start of March.
And if the dollar looks more attractive against the background of these trade negotiations, then the world markets as a whole are declining due to fears. The euro is already losing against the pound and is likely to continue to slide down, but at the same time the single currency remains stable against the dollar, having even managed to update the two-week maximum of 1.1450 dollars. The American currency is held back by a pause in trading before the Fed has to report on the results of the meeting. The dollar index versus a basket of six major currencies fell by 0.1 percent, to 95.732 points, and the yield of US treasury bonds fell markedly.
The dollar fell by 0.1 percent, to 109.29 yen, lost 0.5 percent to the Australian dollar, which rose after consumer price growth in the last quarter surpassed expectations. Australia's inflation in September-December was 0.5 percent, exceeding the forecast of 0.4 percent. Also, a sharp jump in iron ore prices contributed to the growth of the Australian. The Chinese yuan continues to rise, started at the beginning of the year - 6.7135 yuan per dollar, the highest since July 2018. However, the currency mainly grew on optimism regarding the negotiations between the United States and China and the soft attitude of the Fed, which limited the strengthening of the American currency.
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