12 May 2025 | Dollar

De-escalation of US-China trade relations supports dollar

De-escalation of US-China trade relations supports dollar

The United States has been negotiating with China over their trade relations. Recent developments indicate visible progress in these talks. Reinforcement of positive market expectations is favorably affecting commodity prices as well as the dollar, according to Reuters.

Following Sunday's meeting between representatives of the world's two largest economies, the American officials managed to reach an agreement with China on reducing the US trade deficit. Other details of the talks remain undisclosed.

Reuters cited several expert opinions on the matter. For instance, Natixis chief economist Christopher Hodge believes that the de-escalation of trade relations between the two countries was inevitable. However, he does not see significant changes in their future cooperation. Tariffs may be reduced and not apply to all imported goods, but they will probably remain in place, potentially hindering the US economic growth, the expert noted.

Jack Ablin of Cresset Capital also views the outcome of Sunday's meeting between the US and China positively, suggesting that both sides are likely to avoid a severe confrontation.

Elena Dorokhina MarketCheese
Period: 23.11.2026 Expectation: 170 pips
Buy Brent crude with $120 in sight
23 October 2026 34
Gold sell
Period: 06.11.2026 Expectation: 120 pips
Gold sell-off targets $3,890
23 October 2026 30
Period: 22.11.2026 Expectation: 145 pips
Invest in S&P 500 with 7,845 in mind
22 October 2026 45
Period: 22.11.2026 Expectation: 2400 pips
Sell Bitcoin down to $80,500
22 October 2026 40
Period: 04.11.2026 Expectation: 2700 pips
Go long on NVIDIA stock with $243 in view
21 October 2026 60
Period: 04.11.2026 Expectation: 1300 pips
EURUSD sell-off targets 1.0000
21 October 2026 58
Go to forecasts