TALKING POINTS – CHINA, HUAWEI, TRADE WAR, US SHUTDOWN, DOLLAR, YEN

  • Yen up, commodity bloc FX down regardless of report PBOC money injection
  • US probe of Huawei hints at hassle in US-China commerce battle negotiations
  • S&P 500 futures trace danger aversion to proceed in European, US commerce

The sentiment-geared Australian, Canadian and New Zealand {Dollars} sank alongside US inventory index futures in Asia Pacific commerce, seemingly ignoring good points on most native bourses. They traded greater after the PBOC dialed up financial stimulus with a record-setting liquidity injection of CNY380 billion.

Broader monetary appeared unconvinced nevertheless. The Japanese Yen – a standby regional anti-risk outlet –outperformed towards its G10 FX counterparts. The US Dollar additionally traded broadly greater, with merchants apparently rediscovering the benchmark unit’s haven enchantment.

World slowdown fears appear to be a serious contributor poisoning traders’ temper. That’s after the White Home downgraded projections to say that the continued US authorities shutdown will price 0.13 share factors of quarterly GDP development per week.

Doable indicators of escalation within the US-China commerce battle in all probability compounded negativity. Chinese language know-how large Huawei was reported to be the topic of a US industrial espionage probe. Mental property theft is a serious US gripe with China, making the transfer seem like one thing of a negotiating tactic.

Bellwether S&P 500 futures are pointing convincingly decrease, hinting the risk-off strikes defining main currencies in APAC hours have scope for follow-through. Merchants can be smart to proceed with warning nevertheless. Sensitivity to headline danger stays unusually excessive, warning of seesaw volatility.

See our market forecasts to study what is going to drive currencies, commodities and shares in Q1!

ASIA PACIFIC TRADING SESSION

Asia Pacific Trade Economic Calendar

EUROPEAN TRADING SESSION

Europe Trade Economic Calendar

** All instances listed in GMT. See the full economic calendar here.

FX TRADING RESOURCES

— Written by Ilya Spivak, Foreign money Strategist for DailyFX.com

To contact Ilya, use the feedback part under or @IlyaSpivak on Twitter





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