Asian Currencies Stall as Traders Wait on Trump-Xi Meeting
Asian currencies held in tight ranges against the dollar in morning trade as dealers looked to the Sept. 24 meeting between Donald Trump and Xi Jinping in Washington. The Wall Street Journal described the tight ranges in its currency note. Reuters reported Sept. 18 that the two leaders were scheduled to meet in Washington on Sept. 24.
That pause followed a soft two-week stretch for the dollar. The WSJ Dollar Index, a broad gauge that tracks the dollar against a basket of currencies, fell 0.13% on the week to 95.12, according to The Wall Street Journal. Over two weeks it lost 0.78 point, or 0.81%. That two-week fall in points and in percent was the largest since the week ending Aug. 7, 2026.
The same Sept. 11 note flagged haven demand for the dollar as a possible weight on Asian currencies. Haven demand means investors buy dollars when risk rises. An earlier note pointed to ongoing U.S.-Iran tensions as a possible weight. In plain terms, the weekly trend was dollar softness, with room for short bursts of dollar buying when nerves spike.
The Washington meeting would be the second Trump-Xi summit of 2026. The two leaders held a summit in Beijing in May. In July, Marco Rubio was expected to discuss the summit during Asia meetings, with a meeting with Wang Yi likely focused on preparations for a second 2026 summit, Reuters reported. The key issue for Sept. 24 was whether the trade truce would hold or the U.S. and China would return to trade war.
Price action around the May summit showed how fast rate bets and safety buying can reprice the dollar. Ahead of Beijing, investors expected Trump and Xi to keep trade tensions on the backburner, according to Reuters. While that summit was under way, the dollar index rose 0.37% to 98.83. The euro was down 0.29% at $1.1676 at the same point, Reuters reported. The Wall Street Journal described Asia markets as gloomy as the meeting concluded. The prior cycle included an October 2025 meeting after which the Journal headlined "Trump Meets With Xi, Declares Immediate Cut to Tariffs."
The IMF published "Asia's Pragmatic Currency Pivot." The piece noted that the dollar still dominates trade in Asia, according to the IMF. Much of Asia's trade is still priced and settled in dollars, so dollar-Asia rates still move inside that system.
The broader context here is event risk squeezing daily trading while risk of a sharp move stays priced. Consolidation after the largest two-week dollar slide since early August looks more like traders squaring positions than a new firm bet. Spot ranges narrow. More of the adjustment shows up in forward points, the cost of swapping currencies over time, and short-term bets on volatility into the meeting date. May is useful only as order of events: calm hopes beforehand, firmer dollar and softer euro during talks, weak regional stocks into the close. For ordinary savers and borrowers, that pattern matters because tariff headlines can feed quickly into import prices and market rates.
Looking at what this means for pricing around Sept. 24, the question is unusually clean. Truce holds or return to trade war. For dollar-Asia, that means two-sided headline risk around tariffs, with haven demand for dollars as the channel the Journal flagged. Exporters and importers tend to wait before Washington statements. Liquidity thins. Orders cluster just outside recent ranges, so a short calm can break fast on wording, even when the move reverses within days.
In my view, skepticism is warranted about turning a summit headline into a lasting currency shift. The IMF point on dollar dominance in Asian trade cuts against quick calls for change in invoicing or reserve use. Tariff cuts can be declared in a headline and then settled in exemptions and enforcement timelines. Experienced desks tend to keep core protections in place past Sept. 24 and wait for settlement data rather than communique language.
