Fresh US-China trade tensions hit the risk sentiment across the forex board today as latest reports from the Chinese media cited that China is no longer interest in the trade talks with the US and would rather suspend the ongoing negotiations on lack of sincerity from the US.
USD/JPY reversed a temporary break above the 110 handle and returned to the red zone in tandem with S&P500 futures. The spot headed back towards the 109.50 level as a flight to safety re-emerged. Amongst the European currencies, EUR/USD was better bid but below the 1.12 handle while the Pound remained on the defensive around the 1.2780 level amid UK political uncertainty.
In today’s European calendar there is nothing much of note, in terms of macro news, except for the Eurozone final CPI and construction output data due at 09:00 GMT. The UK docket remains data-empty and hence, all eyes are focussed on the UK cross-party Brexit talks that are expected to be closed today and probably without reaching a deal.
In the NA session, the US UoM preliminary consumer sentiment data, due at 14:00 GMT, will remain the key focus. At 17:00 GMT, oil traders will look forward to the US rigs count data due to be published by Baker and Hughes oilfield services company.
Apart from the macro releases, the speeches by the following central bankers will be also closely heard amid escalating US-China trade tensions.
- – 17:40 GMT: Fed’s Clarida.
- – 18:00 GMT: Fed’s Williams.
Oil prices rose on Friday in Asia and extended gains into a fourth straight day amid intensifying Middle East tensions. The gain in oil prices today came after Saudi Arabia’s vice-minister of defence said on Twitter that a drone attack on Tuesday was ordered by Iran. The report raised concerns that the world’s largest oil-producing region is edging toward another war and boosted oil prices higher.
Gold futures traded modestly flat near $1,286, having found support from the renewed trade spat.