The Japanese yen is showing little movement in the Tuesday session. In North American trade, the pair is trading at 111.46, up 0.35% on the day. In economic news, U.S ISM Manufacturing PMI jumped to 61.3, well above the estimate of 57.6 points. There are no major Japanese indicators on the schedule.
The U.S manufacturing sector is in good shape, according to a key indicator. In August, the ISM Manufacturing PMI survey climbed to 61.3, up from 58.1 a month earlier. This marked the indicator’s highest level since February 2011. The survey found that strong business conditions had created a stronger demand for manufactured goods. However, many manufacturers are concerned with tariffs and how long they will last, which has led to uncertainty in the pricing of goods.
With investors again focused on global trade tensions, the U.S dollar is broadly higher on Tuesday. Foremost in investors’ mind is the simmering trade dispute between the U.S and China. So far, the two economic giants have imposed $50 billion in tariffs on each other, and President Trump has threatened further tariffs worth some $200 billion, which could be imposed as early as this week. The U.S could elect to impose the tariffs in smaller bites, such as a $50 billion tariff. Trade trouble brews elsewhere as well. Talks are continuing between the U.S and Canada, after Friday’s deadline passed with no agreement in place. The EU has also engaged in a tit-for-tat tariff exchange with the United States. The dollar has climbed significantly since trade tensions began in April, as the dollar has benefited from being the primary reserve currency.