Forex - Dollar Holds Steady Ahead of New US Tariffs on China

© Reuters. Dollar Holds Steady Ahead of New U.S. Tariffs on China

Investing.com - The dollar was little changed against its major rivals on Monday, amid renewed fears over an escalating trade war between the world's two largest economies.

With little data on the economic calendar, market focus will largely be attuned to the next potential steps in the tit-for-tat trade dispute between the U.S. and China.

U.S. President Donald Trump is likely to announce new tariffs on about $200 billion on Chinese imports as early as Monday, a senior administration official told Reuters.

The tariff level will probably be about 10%, the Wall Street Journal reported, quoting people familiar with the matter. This is below the 25% the administration said it was considering for this possible round of tariffs.

The WSJ also reported that China may decline to attend trade talks due next week as Beijing won't negotiate under threat.

The , which measures the greenback’s strength against a basket of six major currencies, held at 94.47 by 3:40AM ET (08:40GMT), well above Friday's low of 94.36, which was the lowest since the end of August.

Against the yen, the dollar was a shade lower at 111.95 (), but still within sight of Friday's two-month high of 112.16.

The dollar has seen a surge in safe-haven demand from an escalation of global trade tensions between the U.S. and its major trading partners on the belief that the U.S. has less to lose from the dispute.

Elsewhere, the euro and the pound enjoyed positive starts to the week on encouraging developments on terms for Britain's exit from the European Union, paring some safe-haven demand for the dollar.

The euro ticked up 0.1% to 1.1633 () against the dollar. The pound was also slightly higher at 1.3085 ().

The first of three Brexit summits are set for the coming week, where EU leaders hope to settle an agreement within the next two months over the terms of Britain's departure.

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