Commodity and risk currencies rallied overnight on reports the US may soon rollback tariffs on Chinese consumer goods. Asian stock futures pointed to modest gains Tuesday.

The Australian dollar gained as much as 1.1% while South Africa’s rand rose almost 1%. The offshore yuan advanced 0.1%. 

President Joe Biden may announce as soon as this week a rollback of some tariffs—as well as a new probe into industrial subsidies that could lead to more duties in strategic areas like technology. Biden has not yet made a final decision, and the timing could slip, according to people familiar with the deliberations.

The Wall Street Journal previously reported a decision could come as soon as this week.

“The market is responding positively to the headline,” said Neil Jones, head of foreign-exchange sales to financial institutions at Mizuho bank Ltd.. “It’s exactly what commodity currencies need right now.”

Commodity-linked and risk currencies have been pummeled by concerns over an economic slowdown and increasing trade barriers. Both the rand and Aussie are still trading near the lowest levels since 2020. 

Some strategists cautioned that the moves may be unsustainable, given the trajectory of tighter global monetary policy. 

The rally “should not run too far,” said Adam Cole, chief currency strategist at RBC Capital Markets. “This is only a small offset to those factors.”