Dollar Soars as U.S.-China Tariff Truce Boosts Markets
The U.S. dollar surged following a trade truce between the United States and China, easing fears of a global recession. The agreement to reduce tariffs boosted global markets. The euro and yen weakened against the dollar, while Federal Reserve rate cut expectations were reduced.
The U.S. dollar gained ground on Tuesday after the United States and China announced a tariff truce, temporarily defusing trade tensions that had gripped global markets. The agreement brought a sigh of relief for investors who feared a prolonged trade war might spur a global economic slowdown.
Washington and Beijing agreed to reduce tariffs for 90 days, triggering a surge in global stocks and a strengthening of the dollar against major currencies such as the yen and euro. Analysts noted that the U.S. administration's move suggests an awareness of economic impacts from tariffs.
In light of the trade truce, market expectations for Federal Reserve rate cuts have diminished. U.S. Treasury yields rose as optimism about the economic outlook intensified. Meanwhile, in the cryptocurrency space, bitcoin and ether experienced significant price movements, buoyed by overall market sentiment.
(With inputs from agencies.)
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