Dollar Holds Steady as Markets Brace for U.S. Inflation Data and China Trade Deadline

After a week of losses, the U.S. dollar steadied on Monday as investors shifted focus to two major events Tuesday’s U.S. consumer price index (CPI) report for July and the fast-approaching August 12 deadline for a trade deal between Washington and Beijing.

The dollar index was flat at 98.25, holding ground after a 0.4% drop last week. Against the Japanese yen, the greenback traded at 147.685 unchanged, with Japanese markets closed for the Mountain Day holiday.

Trade Talks Under the Spotlight

With time running out to avoid steep new tariffs, markets are closely watching the Trump administration’s negotiations with China, particularly over semiconductor exports. According to the Financial Times, chipmakers Nvidia and AMD have agreed to allocate 15% of their China sales revenues to the U.S. government in exchange for export licences. The deal follows Beijing’s concerns over Nvidia’s H20 chips, which Chinese state media-linked sources claim could pose national security risks.

Chris Weston, head of research at Pepperstone Group, suggested another 90-day truce is likely. “If Trump says ‘15% and we’ll call it a day,’ that may not be too bad,” Weston commented.

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The offshore yuan fluctuated as weekend data showed China’s factory-gate prices fell more than expected in July, while consumer prices remained flat.

Other Market Movers

• The Australian dollar slipped 0.2% to $0.6515 ahead of the Reserve Bank of Australia’s interest rate decision Tuesday, with expectations of a 25 basis-point cut to 3.60%.

• The New Zealand dollar edged down 0.13% to $0.59455.

• The British pound eased 0.1% to $1.34405.

Crypto Climbs

Bitcoin rose 0.7% to $119,154, close to its record high, while Ether gained 1.1% to $4,267 — its highest since December 2021.

Policy and Personnel in Washington

U.S. Treasury Secretary Scott Bessent told Japan’s Nikkei that the next Federal Reserve chair should be someone capable of “examining the whole organisation” as the Fed’s expanded mandate risks its independence.

Meanwhile, the Trump administration is reportedly interviewing candidates to lead the Bureau of Labor Statistics, including E.J. Antoni, chief economist at the conservative Heritage Foundation, according to The Wall Street Journal.

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