Dollar gains against yen as Trump's trade war intensifies
The greenback advanced against major peers on Tuesday after Trump began telling trade counterparts that sharply higher US tariffs will start on August 1, but he later said he was open to extensions if countries made proposals.
Trump said on social media that there would be announcements on Wednesday regarding "a minimum of 7 countries having to do with trade," without specifying whether he would be announcing new deals or tariff letters.
Multiple rounds of talks have failed to result in a breakthrough between the US and Japan, where policymakers are now increasingly focused on a critical upper house election this month.
"Talks appear to be stalled over Japan's rice market protections and it's hard to see the Japanese bending on this one," IG analyst Tony Sycamore wrote in a client note. "The (currency) pair's rise was also supported by a fifth day of gains in US yields and a sharp rise in JGB yields on fiscal concerns ahead of Japanese elections on July 20."
The dollar climbed 0.2 per cent to 146.85 yen, after touching a more than two-week high on the previous day. The euro was little changed at US$1.1720.
The dollar index, which tracks the US currency against a basket of six major peers, was steady at 97.582 after a two-day climb. Sterling traded at US$1.35795, down 0.1 per cent in early trading.
Bank of Japan board member Junko Koeda said she was keeping a close eye on possible second-round effects on underlying inflation from recent rises in the price of rice, Bloomberg News reported on Wednesday.
The European Union will not receive a tariff letter and could secure exemptions from the US baseline rate of 10 per cent, EU sources familiar with the matter told Reuters on Monday.
Trump on Tuesday said he would impose a 50 per cent tariff on imported copper and will soon introduce long-threatened levies on semiconductors and pharmaceuticals.
US Treasury Secretary Scott Bessent will skip a Group of 20 finance officials meeting in South Africa next week, sources familiar with his plans told Reuters, but will attend the World Expo 2025 in Osaka, Japan, according to a Treasury spokesperson.
The Australian dollar fetched US$0.6526, down 0.07 per cent after Tuesday's 0.6 per cent jump. New Zealand's kiwi dollar traded at US$0.5993, down 0.1 per cent.
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