US-China talks next week raise some hopes; USD inches lower and the Euro in support

US Dollar inches back after Wednesday’s 13-month highs, and has been receding up to this morning. On Thursday the US and China agreed to start trade talks between August 21 & 22, the announcement offered some respite to concerns that this trade war may continue to spiral.

The euro’s quick descent on concerns of a spill over of current Turkish woes, also managed to find some respite from the news of US-China talks later next week. Trump’s announced doubling of tariffs on Turkey proved to be the straw that broke the camel’s back, for a country like Turkey suffering twin deficits and whose monetary policy efficacy has become debatable.

EURUSD has risen to the current 1.1376 after hitting 1.1301 earlier this week. The trend remains bearish, and TraderTip’s daily scenario anticipates more drops as long as the currency pair lies below 1.1412 levels.

Late into Thursday the semi-annual testimony delivered by RBA Governor, took the limelight as the Governor was quoting as saying that interest rates would stay low still “for a while yet”. The Aussie gained some ground overnight against both the euro and the USD, but gains remained capped so far.

Today’s major highlights, and major impact data revolves around the Canadian CPI and the US University of Michigan Sentiment index later this afternoon.

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