The Australian and New Zealand Dollars are trading higher during the U.S. session on Friday on hopes of progress in U.S.-China talks. The currencies are also being driven by a stronger Chinese Yuan, which hit a three-week high in the Asian trading session of 7.0890 per dollar.
The currencies were supported early in the session after top U.S. and Chinese negotiators wrapped up their first day of trade talks on Thursday, prompting U.S. President Trump to say, “very, very good negotiation with China”.
The Aussie and the Kiwi were driven even higher early in the U.S. session after President Donald Trump struck an optimistic tone on the trade talks with China on Friday as the two countries try to end a 15-month-long trade war that is taking a toll on the global economy.
“Good things are happening at China Trade Talk Meeting,” Trump said in a tweet. “Warmer feelings that in recent past, more like the Old Days. I will be meeting with the Vice Premier today. All would like to see something significant happen!”
The AUD/USD and NZD/USD hit their session highs following his tweet.
Trump’s meeting with Chinese Vice Premier Liu He is scheduled for 18:45 GMT. The face-to-face meeting with the head of the Chinese trade delegation is also seen as a positive sign.
Trump also said Friday a trade deal between the U.S. and China doesn’t require approval from the Congress, making a possible deal “fast and clean.”
“One of the great things about the China Deal is the fact that, for various reasons, we do not have to go through the very long and politically complex Congressional Approval Process. When the deal is fully negotiated, I sign it myself on behalf of our Country. Fast and Clean!” Trump said in a tweet.
Prices could surge further later in the session if the two countries could agree to at least a partial agreement on issues such as currency and agriculture buying. This would leave more controversial issues such as protections against Chinese theft of U.S. intellectual property, for later negotiations. According to CNBC, multiple reports suggest a delay in the tariff hike could also be agreed upon.
A state-run Chinese newspaper said in an editorial Friday that “a partial deal is a more feasible objective.” China also set a clear timetable for opening its finance industries, adding to a slew of positive developments overnight.
Late Thursday, China’s securities regulator announced a timetable to remove a requirement that foreign financial companies must have a Chinese investor. Additionally, the New York Times also reported the two sides could announce a deal that would avoid raising tariffs on Chinese goods.
This article was originally posted on FX Empire
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