- Trade talk sentiment gaining traction and supporting bullish base for risk assets.
- President Trump has announced and agreed to delay increased Chinese tariffs.
- AUD/USD has climbed nearly 3% since bottoming earlier this month.
In the latest piece of good news on the trade war front, President Trump has announced and agreed to move increased Chinese tariffs on 250 billion dollars’ worth of goods to October 15th.
At the request of the Vice Premier of China, Liu He, and due to the fact that the People’s Republic of China will be celebrating their 70th Anniversary on October 1st, we have agreed, as a gesture of good will, to move the increased Tariffs on 250 Billion Dollars worth of goods (25% to 30%), from October 1st to October 15th.
Trump tweeted.
FX implications
China has been pushing the plans to stimulate growth in the economy and the latest news is that measures will be put into place to attract long-term funds to stocks while potentially easing limits on pension and insurers’ stock investment. As a consequence of the combination of trade talk traction and stimulus measures, commodity currencies are getting a boost and risk appetite has been returning to markets. AUD/USD has climbed nearly 3% since bottoming earlier this month down in the 0.6680s and has completed a 50% man reversion of the July highs to aforementioned swing lows.
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