The US dollar dropped against its most major counterparts in the European session on Tuesday, as investors cheered progress in trade talks between Washington and Beijing following news that China’s Vice Premier Liu He held telephonic conversation with Treasury Secretary Steven Mnuchin to resolve the dispute.
The conversation was focused on Chinese purchases of agricultural products and changes to fundamental Chinese economic policies.
“Both sides exchanged views on putting into effect the consensus reached by the two countries’ leaders at their meeting, and pushing forward the timetable and roadmap for the next stage of economic and trade consultations work,” China’s commerce ministry said in a statement.
Data from the Labor Department showed that US producer prices unexpectedly showed a modest uptick in the month of November.
The Labor Department said its producer price index for final demand inched up by 0.1% in November after climbing by 0.6% in October. Economists had expected prices to be unchanged.
The currency has been trading lower against its major counterparts in the Asian session.
The greenback edged down to 1.1400 against the euro, from an early 5-day high of 1.1350. The greenback is poised to find support around the 1.15 mark.
Data from the Centre for European Economic Research showed that German investor confidence rose strongly in December, defying expectations for a modest weakening.
The ZEW Indicator of Economic Sentiment for Germany rose 6.6 points to reach minus 17.5 points in December.
The greenback reversed from an early high of 1.2550 against the pound and fell to 1.2638. On the downside, 1.28 is seen as the next likely support level for the greenback.
The greenback dropped to 0.9863 against the franc, its lowest since October 16. The greenback is seen finding support around the 0.97 mark.
The greenback fell to 0.6904 against the kiwi, 0.7224 against the aussie and 1.3378 against the loonie, from its early highs of 0.6862 and 0.7185, a 5-day high of 1.3422, respectively. The next possible support for the greenback is seen around 0.70 against the kiwi, 0.74 against the aussie and 1.32 against the loonie.
On the flip side, the greenback bounced off to 113.26 against the yen, from an early low of 113.01. If the greenback rises further, it may find resistance around the 115.00 region.
Data from the Bank of Japan showed that Japan M2 money stock rose 2.3% on year in November, standing at 1,010.5 trillion yen.
That was shy of expectations for an increase of 2.6% and down from 2.7% in October.
