7 Jun 2013
Flash: USD bears eyes of US-China leaders meet - DBS Group
FXstreet.com (Barcelona) - DBS Group analysts feel that USD bears will be paying attention to this weekend’s informal meeting between US President Barack Obama and China President Xi Jinping in California.
They note that US lawmakers have submitted a letter to Obama urging new rules against currency manipulation by Asian countries in trade talks. Interestingly, they feel that the letter was not targeted at China, but was sent to coincide with the testimony of US trade representative nominee Mike Froman. They feel that it would also appear that while currency manipulation continues to be a concern with China, US lawmakers have also become more wary of Japan. They write, “Returning to China, there is expectation that the USD/CNY trading band may be widened to possibly ±2% around its central parity from the present ±1% between the Obama-Xi meeting and the upcoming Strategic Economic Dialogue scheduled at Washington on July 8-12.”
They note that US lawmakers have submitted a letter to Obama urging new rules against currency manipulation by Asian countries in trade talks. Interestingly, they feel that the letter was not targeted at China, but was sent to coincide with the testimony of US trade representative nominee Mike Froman. They feel that it would also appear that while currency manipulation continues to be a concern with China, US lawmakers have also become more wary of Japan. They write, “Returning to China, there is expectation that the USD/CNY trading band may be widened to possibly ±2% around its central parity from the present ±1% between the Obama-Xi meeting and the upcoming Strategic Economic Dialogue scheduled at Washington on July 8-12.”