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Foreign Exchange Markets: US-China Trade in Focus

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The Dollar was supported on Monday, with the market's risk appetite rated as "productive" following talks between US and Chinese sales representatives in Washington.

The dollar gained against the safe-haven yen, but counter-movements in currency-denominated currencies, such as the Australian and New Zealand dollars, which performed well due to cautious risk sentiment, were relatively small, as volumes were affected by a public holiday Japan was dampened by the expectation that central banks on both sides of the Tasman Sea would sound cautious in the planned remarks this week.

"I think there is still a lot of nervousness," quoted Shane Oliver, chief economist at AMP Capital in Sydney, as the main driver of tensions in the Middle East and the lashing fate of the US-Chinese trade dispute.

"These things have the habit of escalating and de-escalating and then escalating … it's a bit balanced right now," he said.

The dollar rose 0.1

% and bought 107.70 Japanese yen. The Australian and New Zealand dollars lost $ 0.6768 and $ 0.626 against the kiwi.

Compared with a basket of currencies, the dollar remained largely unchanged at $ 98,500, trading at $ 1,1017 per euro.

The pound was trading at $ 1.2476, after plummeting from a two-month high on Friday, when the Irish foreign minister said Britain and the European Union are not yet close to Brexit.

A US-China trade breakthrough It seemed unlikely after President Donald Trump told reporters Friday he was "not seeking a partial agreement" and Chinese officials then said goodwill visits to US farmers.

Both sides, however, later issued positive statements to the US Trade Representative's Office The talks are described as "productive" and described by the Chinese Ministry of Commerce as "constructive". Talks at a high level in October are still going according to plan.

China's yuan in offshore trading rose 0.2% to $ 7.1025, though few expect significant recovery or sentiment should signs of a US breakthrough emerge – Chinese trade negotiations.

"At some point the basics are being taken over," said Mathan Somasundaram, strategist at Blue Ocean Equities in Sydney. "(The talks involve some risk … but I think we'll be on a certain stance."

September manufacturer surveys in Europe and the US due later Monday's news on the state of the global economy hit by a slowdown in global demand and trade wars is expected to come in. One speech after the central bank announced on Friday Interventions on the US refinancing market plan to strengthen the liquidity of the dollar.

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