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Leading Currencies Underscore Time as Traders Prepare for Vital Developments

The greenback and yen principally held the safe-haven high ground Tuesday, with traders wary of a looming deadline for U.S. tariffs on China, the British election, and upcoming Federal Reserve and European Central Bank conferences.

Front of mind is whether or not Washington will go ahead with the latest round of tariffs on Sunday, or whether a deal with China could be reached before then.

White House economic adviser Larry Kudlow stated Friday that the December 15 deadline is still in place, however, Agriculture Secretary Sonny Perdue on Monday raised the possibility the taxes are not imposed.

Rising inflation in China, ahead even of grand expectations, had little effect on a market waiting for trade development.

Towards the Japanese yen, the dollar found support after last week’s declines, steadying at 108.62 yen. The dollar drew slightly towards the euro to $1.1066 and was steady against a basket of currencies at 97.623.

The New Zealand dollar rallied as bears trimmed short bets following a slew of current upbeat economic information, increasing 0.2% to $0.6560 and dragging the Australian greenback higher with it to $0.6828.

The U.S. greenback’s recovery after weakness last week had been strengthened by a hike in hiring last month.

That has investors confident that the U.S. Federal Reserve will hold rates steady when their two-day meeting ends Wednesday, increasing investors’ focus on the outlook and on finding a trade-conflict break.

China said Monday it to reach a trade deal with the US as soon as possible, although it gave no new details or insight into the progress of the discussions.

Sterling inched higher to $1.3150, just below a seven-month high hit last week, as polls pointed to a Conservative triumph sure enough to secure a parliamentary majority.