The US dollar initially fell in today’s trading session before rebounding on the back of strong jobs data that keeps the US Federal Reserve on track to lift interest rates next month

The weakness in the US dollar came as new surfaced that US president Donald trump had a very constructive telephone conversation with Chinese President XI Ping and has now instructed members of his cabinet to put together a draft deal.

Some say this may be a ploy to boost the Republican Party’s chances in the elections next week by making the announcement to boost the stock market.

"Talk of a trade deal has added further juice to the last few day's risk appetite, weakening the dollar," said Kit Juckes, a strategist at Societe Generale.

"Either Trump is paving the way for a trade deal later this month or he's cynically driving up equity indices ahead of U.S. mid-term elections," he added.

Lanhee Chen, a research fellow at the Hoover Institution disagrees and believes that both presidents are looking for a way out of the situation as the standoff is having a profound effect on China and the US with regards to financial markets

"I tend to think that they are looking for something as a pathway to progress” he said

They're looking to be able to say, 'Look, we have reached even a very small measure of agreement on something,' and use that as a catalyst to get some additional resolution on the U.S.-China trade issue," he added.

The non-farm payrolls figure from the US released earlier today hit the market at 250,000 against analysts’ expectations for a number of 190,000 and shows the jobs market is still powering ahead and leaves the door well and truly open for the Fed to hike rates in December.