US-China trade optimism, US jobs report focus


The dollar rose to a three-week high against the yen on Friday, heightened by expectations that a protracted US-China trade dispute would be resolved soon.

The dollar gained about 0.85 percent against its Japanese port-insurance pair this week, thanks also to factors such as strong US economic data and broad improvement in risk appetite.

The trade war between the world's two largest economies has been a major distraction to financial markets last year, with riskier assets in particular reaching concerns about expanding business and the impact of growing conflict.

US President Donald Trump said on Thursday that both countries are coming very close to a trade agreement that can be announced within four weeks.

On the economic front, investors will have the opportunity to assess the health of the world's largest economy when the March US report is released at 12:30 GMT.

"In particular, the focus is on how strong the earnings component of the jobs report is. A strong wage outcome would underpin robust private consumption and hasten the recovery of Treasury yields, and in turn allow the dollar / yen to test highs "said Junichi. Ishikawa, senior exchange strategist at IG Securities in Tokyo.

The dollar extended gains overnight and rose to 111.80 yen, the highest since March 15.

The euro was stable at $ 1.1223 after data released on Thursday showed that the German industrial order fell in February.

The pound was almost stable at $ 1.3074, after losing 0.7 percent overnight.

The British pound fell on Thursday, taking a three-day high, while worries were mounting that Britain might be preparing for a prolonged delay in Brexit.

Britain could ask the European Union for a long delay at Brexit next week if negotiations between the government of Prime Minister Theresa May and the opposition Labor Party failed to get out of the impasse over the European Union's divorce.

The dollar index against a basket of the six major currencies remained unchanged at 97,300, after rising 0.2% the previous day.

The Australian dollar was slightly higher, at $ 0.7120.

The currency rose about 0.3 percent this week, bolstered by signs of progress in the US-China trade dispute that has raised risky assets and commodity prices.


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