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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Official Website]: The US dollar rebounds 100 key threshold in the short term, and Trump releases a big signal to lower tariffs on China!". Hope it will be helpful to you! The original content is as follows:
On May 6, during the Asian session on Tuesday, the US dollar rebounded slightly to 100, and the Taiwan dollar continued to rise since last Friday, setting the largest increase since the 1990s. Foreign media reported unconfirmed speculation that any trade agreement that may reach with the United States may involve exchange rate readjustment. Taiwan and the United States trade negotiations held their first formal talks on May 1, but the results have not been announced yet.
At the beginning of this week, speculation about a potential trade deal triggered a sharp rise in the NTD and caused a response in the global foreign exchange market, and the US dollar was hit again.
The dollar has been under pressure as U.S. President Trump's economic agenda weakened attitudes toward U.S. assets, and the dollar further weakened against most major currencies on Monday. The Bloomberg dollar index closed down about 0.2% in New York, after recovering its earlier decline.
The Taiwan dollar led the rise among the 16 major currencies tracked by Bloomberg, and once hit its biggest gain in more than 30 years in the early trading week. The yen rose about 0.9%, leading the G10 (G10), with the euro/dollar exchange rate breaking through the 1.13 mark.
Since taking office in January this year, Trump's aggressive trade rhetoric has shaken the macro market, weakening the dollar's traditional safe-haven status in a period of economic tensions, causing investors to withdraw from U.S. assets.
In recent days, investors have focused on the scope and nature of the trade and tariff agreements negotiated by the Trump administration with key partners and whether this would involve coordinated efforts by global policymakers to further weaken the dollar.
Ari, global foreign exchange strategist at JPMorgan in Singaporendam Sandilya, who described the recent trend of Asian currencies in his podcast, said: "We are all a little shocked by the region. The sharp synchronous appreciation of the currency has sparked discussions among central banks in the region about reaching a certain currency agreement."
Despite a slowdown in May, the Bloomberg dollar spot index has still fallen nearly 7% this year, the biggest drop since its inception 20 years ago. Meanwhile, traders in speculative derivatives markets have reached their highest level since September, according to latest data from the U.S. Commodity Futures Trading Commission (CFTC).
China's Caixin Service Industry Purchasing Managers Index fell from 51.9 to 50.7 in April, lower than the expected 51.7. The comprehensive purchasing managers index also fell from 51.8 to 51.1, indicating that the momentum in the manufacturing and services sectors has weakened.
Caixin.com's Wang Zhe said that amid the intensification of trade frictions, the expansion of supply and demand has slowed down. Export-driven industries remain under particularly stressful, while unemployment and sluggish pricing power continue to squeeze corporate profit margins. The employment part of the comprehensive index also contracted.
Perhaps most worrying is that expectations for future economic activity fell to the lowest level on record, reflecting an increase in uncertainty within the business. "The ongoing tariff impasse between China and the United States will gradually be felt in the second and third quarters," Wang added.
意大利欧洲央行管理委员会成员法比奥·帕内塔（FabioPanetta）今天警告说，保护主义抬头对全球经济稳定构成严重威胁
帕内塔在一次活动中说：“贸易开放对发达国家和发展中国家都有好处，减少了不平等，使数亿人摆脱了极端贫困。
然而，“保护主义有可能抹杀这些成就，并削弱全球繁荣的结构，”他补充说。
他强调，地缘政治紧张局势以及全球贸易日益增长的不确定性正在成为政策制定者的主要考虑因素。
欧元区Sentix投资者信心指数从-1 9.5 rose sharply to -8.1, well above expectations. The status quo index climbed from -23.3 to -19.3, the highest level since August 2024. The expected index turned positive, rising from -15.8 to 3.8.
Sentix attributed the improvement in market sentiment to the European Commission's "calm response" to the escalation of U.S. trade action. In addition, unexpected improvements in inflation data reinforced expectations that the ECB would be able to continue its gradual rate cut cycle.
While investors were obviously more optimistic, Sentix noted that sentiment was "more sluggish, but basically 'calm'" compared to March.
Storm's consumer price growth stagnated in April, and overall CPI remained flat on the second straight month.
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On the year, inflation slowed sharply from 0.3% year-on-year to 0.0% year-on-year, marking a flat price level that has never been seen since deflation in early 2021.
Core CPI (excluding fresh and seasonal products, energy and fuels) also lost momentum, falling from 0.9% year-on-year to 0.6%.
Soften inflation was driven by the decline in domestic product prices, which fell -0.1% month-on-month and slowed to 0.8% year-on-year from 1.0%. At the same time, the prices of imported products slightly offset, up 0.3% month-on-month, but still contracted -2.5% year-on-year (the previous value fell 1.7% year-on-year).
The US ISM Services Purchasing Managers Index rose to 51.6 from 50.8 in April, exceeding the expected 50.6. This growth was driven by strong new orders, which rose from 50.4 to 52.3.
Business activity, however, fell from 55.9 to 53.7. Employment rebounded from 46.2 to 49.0, but remained in the contraction zone for the second consecutive month.
The most significant development is the sharp jump in the price index – from 60.9 to 65.1 – the highest level since January 2023.
Overall, the data show moderate economic growth, with ISM estimated annualized GDP growth of 1% based on service industry readings.
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