Dollar recovers some poise after Friday wobble

The dollar recovered some weakness from the end of last week to trade largely higher on Monday, after US President Donald Trump struck a more peacemaking with China, after making a threat on Friday.

Over the weekend Trump said the US wants to help China, not hurt it, striking a conciliatory tone days after threatening the additional tariff.

"The USA. wants to help China, not hurt it!!!," Trump said in Sunday's post on Truth Social, adding that "respected President Xi (Jinping)... doesn't want Depression for his country."

Trump had said Friday he would impose further 100% tariffs on China from November 1 after Beijing imposed "extraordinarily aggressive" export curbs on rare earth minerals.

Versus the dollar, the euro faded to USD1.1572 on Monday afternoon UK time, fading slightly from USD1.1572. Sterling bought USD1.3333, up from USD1.3280.

On Friday, the euro and pound traded as high as USD1.1630 and USD1.3366.

ING analysts commented: "The dollar revealed its vulnerability during Friday afternoon’s FX trading. The fear remains that this year's hike in US tariffs will eventually show up in hard data and once again challenge the idea of US exceptionalism. In the ongoing absence of US data, this week will be dominated by central bankers at the IMF meetings and international politics."

The US observes Columbus Day on Monday. The Securities Industry & Financial Markets Association in the US has recommended a Treasury market closure on Monday as a result. Equities trade as normal.

Financial markets in Tokyo, meanwhile, were closed on Monday.

Against the yen, the dollar traded at JPY152.12 on Monday, down from JPY152.52 at the same time on Friday. It had traded as low as JPY151.11 later on Friday, however.

Analysts at Rabobank commented: "Reflecting recent USD strength, we’ve revised our 3-month USD/JPY forecast to 147.00 (from 145), assuming a BoJ rate hike before year-end. Nonetheless, near-term risks point to a possible snapback in JPY value."

Versus the Swiss franc, the buck faded to CHF0.8045 from CHF0.8054.

Against the Australian dollar, it fell tAUD1.5360 from AUD1.5251. Versus its Canadian counterpart, it shot up to CAD1.4011 from CAD1.3985.

Versus the euro, sterling rose to EUR1.1523 from EUR1.470.

The Dollar Index stood at 99.22 points, fading from 99.32.