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Dollar broadly lower after Trump remarks

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The dollar traded lower against a basket of major peers on Tuesday after U.S. President Donald Trump said he was “not thrilled” with Federal Reserve Chairman Jerome Powell for raising interest rates.

The dollar was also soft as investors pulled out of the safe-haven currency ahead of anticipated talks this week between China and the United States, which some market participants believe might lead to an easing in their escalating trade dispute.

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The dollar index against a basket of six other currencies fell 0.37 percent to 95.554 as of 0345 GMT after touching as low as 95.440, its lowest level since Aug. 9.

“At the moment, markets fear that Trump may have some impact on the Fed’s policy,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.

“Especially the dollar/yen, which is sensitive to the rate moves of the United States, remains under pressure.”

The yen was basically flat at 110.08 yen as of 0345 GMT, paring gains after touching as high as 109.775 yen earlier. The dollar on Tuesday fell below the psychologically-significant 110 yen level for the first time since June 28.

The greenback slipped after Trump said in a Reuters interview on Monday that he was “not thrilled” with Powell’s raising of interest rates. Trump nominated Powell last year to replace former Fed Chair Janet Yellen.

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The president spooked investors in July when he criticised the Fed over tightening monetary policy. On Monday, he said the Fed should be more accommodating on interest rates.

Mizuho Securities’ Yamamoto said Fed officials don’t seem to be influenced by Trump’s comments.

“As long as the U.S. economy is okay…then I think there is no reason to stop the rate hikes from the Fed’s point of view,” he said.

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Trump also said the U.S. central bank should do more to help him to boost the economy, while he also accused China and Europe of manipulating their respective currencies.

Escalating trade tensions between the United States and its trading partners and a plunge in the Turkish lira had pushed the dollar index to 96.984 on Aug. 15, its highest since June 2017.

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The dollar’s rally halted ahead of trade talks between Chinese and U.S. officials in Washington. The meetings, expected to take place mid-week, involve lower-level officials but are the first formal U.S.-China trade talks since June.

“It’s positive news that China and the United States are going to have negotiations. It isn’t bad for the renminbi and a plus for Chinese stocks,” said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank.

On Tuesday, the offshore Chinese yuan was nearly flat against the greenback, edging 0.07 percent higher to 6.8326 per dollar as of 0347 GMT.

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The euro, which had slipped to a 13-month low early last week amid concerns that the Turkish crisis could hurt European bank, gained on Tuesday.

The single currency rose 0.36 percent to $1.15225 as of 0347 GMT, giving up some gains after trading at $1.1544 during early morning trade.

Sera said the euro may have found support on buying from one or more institutional investors in Japan after traders returned to work on Monday after the country’s ‘bon’ holidays last week.

“It’s necessary to watch carefully at what rate the euro settles,” Sera said.

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The Australian dollar was 0.13 percent higher at $0.7350, proving resilient to turmoil in politics at home where Prime Minster Malcolm Turnbull survived a leadership vote with a perilously narrow margin.

Editing by Sam Holmes and Kim Coghill


Report typos and corrections to: [email protected].
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MSNBC analyst shreds GOP claim impeachment is an effort to change the 2016 election

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Republicans have claimed that the reason Democrats have sought impeachment, either from the Russia scandal to the Ukraine scandal, is that they want to unmake the 2016 election. Speaking to MSNBC Sunday, NYU Law Prof. Melissa Murray ripped the claim to shreds.

First, impeachment would only remove President Donald Trump is the Republican Senate voted to do so. If the president were removed, the new president wouldn't be Hillary Clinton; it would be Mike Pence, getting Democrats no victories other than upholding the rule of law.

"As these proceedings go away, there is building support for impeachment; it will require a supermajority of the Senate in order to convict and remove the president, which will require some Republican Senators to peel off and depart from the path," Murray said. "But I think the really important thing that Bob has mentioned here is this idea ta the Republicans are taunting that impeachment is a backend effort to basically subvert the will of the people. I think the testimony that was presented yesterday makes clear that that claim is specious."

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Rudy Giuliani’s devotion has escorted Trump straight to impeachment

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"Step by step, [Rudy Giuliani] has escorted President Trump to the brink of impeachment," The New York Times said in a piece following the president's top lawyer and his impact on the scandals facing the 45th president.

Two associates of Giuliani's have already been indicted, Giuliani is under criminal investigation from federal prosecutors, and he was never graced with a top position in the Trump government.

"The separate troubles he has gotten his client and himself into are products of the uniquely powerful position he has fashioned, a hybrid of unpaid personal counsel to the president and for-profit peddler of access and advice," The Times said Sunday.

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Trump team ‘is as incompetent, shambolic, paranoid, and given to conspiracy theories as it appears’: MSNBC panel

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In a Sunday evening panel discussion, MSNBC commentators explained that the White House appears to be just as chaotic and marred by chaos as the rumors say.

Many in the White House learned that the president's lawyer, Rudy Giuliani, was working overseas in Ukraine. Giuliani claimed that he's been producing a film that he couldn't get Fox News to run, as it will appear on the fringe network OAN.

"What Rudy Giuliani is doing is using Kremlin-manufactured propaganda as a defensive shield for the president," said CNBC's John Harwood. "Fiona Hill was unambiguous in her testimony to the intelligence committee. What Rudy Giuliani has been doing with these two indicted men who are linked to a Russian oligarch who is tied to Russian organized crime, is trying to manufacture a story that Ukraine, rather than Russia or in addition to Russia or differently from Russia, meddle in the campaign. That is false."

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