USD Steady in Anticipation of FOMC Rate Decision
The US dollar holds steady against major currencies, as investors expect an almost certain increase in the rate from the Federal Reserve on Wednesday. For now, US dollar, British pound and Japanese yen are the strongest ones, while commodity currencies are the weakest. The pound will continue to be sensitive to any Brexit headlines after last week’s EU informal summit ended with negotiation in an impasse.
China intends to cancel trade negotiations with the United States because of the latest round of tariffs. Hong Kong’s South China Morning Post reported that China canceled the planned visit by Vice-Premier Liu He to the US on trade. It is unclear when both sides will resume trade negotiations.
Meanwhile, the US tariffs on Chinese goods worth $200 billion and Beijing's response tariffs on US products worth $60 billion will begin to operate today. Since the beginning of this year, both countries have already exchanged tariffs for $50 billion.
FOMC rate statement will be the main event this week. The US central bank is expected to raise its interest rates on Wednesday, which are expected to reach between 2% and 2.25% for the first time after ten years of accommodative monetary policy. RBNZ is another central bank meeting this week. It’s expected to stand pat on monetary policy, with a neutral stance.
US and Canadian officials trying to conclude a deal on NAFTA are "very likely" to hold informal talks in the coming days, Canadian Prime Minister Justin Trudeau said. Both Canadian Foreign Minister Chrystia Freeland and US Trade Representative Robert Lighthizer will be in United Nations General Assembly in New York on Monday and Tuesday.