U.S.-China Trade Talks: Dollar Holds Firm Amid Uncertainty

The U.S. dollar experienced slight gains on Tuesday as trade talks between Washington and Beijing stretched into a second day. Investors grew anxious, holding back on significant financial moves ahead of a critical U.S. inflation report. The discussions aimed to ease longstanding trade tensions that have expanded from tariffs to rare earth restrictions.

The ongoing talks follow a recent conversation between President Donald Trump and China's President Xi Jinping. Both nations are grappling with economic strains resulting from a series of tariffs imposed this year. Despite some optimistic remarks from officials and Trump, the U.S. dollar's movement remained cautious and limited.

Market experts suggest that while the extended talks may offer short-term solace, lasting optimism is dependent on achievable structural progress. Complex issues like chip export controls and rare earths have made swift resolutions intractable. Investors now eye the forthcoming U.S. consumer price index report for insights on tariff impacts and inflation trends.

(With inputs from agencies.)