The U.S. dollar bounced higher versus its major rivals Tuesday, as trade issues remained center stage and Australia’s currency hit a more than 2 1/2-year low.
The Australian dollar AUDUSD, -0.1828% hit a session low of $0.7092 in overnight trading — a level not seen since early 2016 for the antipodean currency. It last bought $0.7102, down from $0.7113.
The Aussie dollar is often seen as a developed market proxy for China’s yuan USDCNY, +0.1648% USDCNH, +0.1398% which was slightly weaker against the U.S. dollar Tuesday. Just Friday, President Donald Trump said import tariffs on another $267 billion of Chinese-made goods could be implemented.
China is meanwhile seeking permission from the World Trade Organization to impose sanctions on the U.S. as part of a dumping dispute.
Check out: How China, trade and domestic worries are encouraging Aussie dollar bears
In the U.S., market participants are focused on a mix of trade headlines and economic data, as the talks with Canada pertaining to the future of the North American Free Trade Agreement are in full swing. On the data front, JOLTS at 10 a.m. Eastern, as well as a few speeches from Federal Reserve bankers in the afternoon.
The ICE U.S. Dollar Index DXY, +0.05% was up 0.1% at 95.224.
Don’t miss: Case for dollar bulls intact ahead of central bank meetings
For the British pound GBPUSD, -0.1075% the optimism over a possible Brexit deal within the next few weeks that had pushed sterling higher on Monday and to touch a high of $1.3088 in early Tuesday trading. The pound last bought $1.3020, little changed from late Monday in New York.
Philip Hammond, the U.K.’s chancellor of the Exchequer, meanwhile announced that Bank of England Gov. Mark Carney will stay on to lead the central bank until January 2020. His term was initially scheduled to end in June 2019. The BOE is next set to meet on Thursday.
Elsewhere, in emerging markets, which remain under pressure, Argentina’s central bank is due to meet later in the day. Market participants expect that its benchmark rates will be kept at 60%. Argentina was forced to up its key rates over the summer to combat its worsening currency crisis. The buck was little changed versus the Argentine peso USDARS, +0.0093% fetching 37.4560.
Read: These 7 countries are most at risk of a currency crisis: Nomura
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