Trump plays hard to get on trade
Trade negotiations between the world’s two largest economies takes another turn, making markets worried.
The EURUSD continues to weaken as the USD strengthens. The pair opened at $1.13604 and bumped up to an early high of $1.13676. The euro remained close to those high in early trading before falling mid-session to a low of $1.13232. It regained some of those losses as it climbed to $1.13598 but fell again to its current level of $1.13395. The GBPUSD was much more volatile overnight as the BoE concluded their monetary policy meeting. The pair opened at $1.29283 and remained flat in early trading before a solid decline set in leading up to the interest rate meeting. The pound tumbled to a low of $1.28531 but was quickly countered with a surge which saw it peak at $1.29955 just a couple of hours later. It could not hold onto those gains as it retraced back its current level of $1.29484.
Indices had a rough day yesterday, albeit for different reasons it seems. The Dow opened at 25,326.13 and traded flat early, lifting to a high of 25,351.86. Then news began to break that Trump would not be meeting his Chinese counterpart Xi Jinping before the tariff deadline. This has sent worry through markets as some believe this could mean an escalation in the US-China trade war. This news sent the Dow falling to a low of 24,988.26. It managed to bounce off those lows but still closed in negative territory, finishing the session at 25,144.46. The Dax was woeful overnight, turning negative quite early in the session. The German index opened at 11,274.63 and bumped up to an early high of 11,286.59. It was all downhill from there as weak economic data, Brexit concerns and a falling Dow all conspired to help drag the Dax to a low of 10,999.59. The Dax closed at 11,031.09 shortly afterwards.
Well, trade tensions look set to climb again with news that Donald Trump and Xi Jinping will not be meeting before a crucial trade deal deadline. This throws world trade into uncertainty as the world’s largest economies are yet to come to some sort of trade agreement.
Data released today include:
Japan – Economy Watchers Sentiment
US – FOMC Member James Bullard speaks
Australia – RBA Monetary Policy Statement
Canada – Housing Starts, Employment Change, Unemployment Rate
Europe – Swiss Unemployment Rate, German Trade Balance, French Prelim Private Payrolls, French & Italian Industrial Production
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