The US/China trade talks have come to an interim conclusion and Trump has issued a proclamation. He confirmed that an agreement has been reached, although leaders of China and the USA, must sign-off on the agreement. There was a subdued reaction on markets to the seemingly positive news, as details need to be clarified. Attention now will turn to the US/EU negotiations. US inflation was softer than expected, easing US bond yields and adding further pressure on the Fed, to cut rates immediately. Pressure is building between the Fed and the Trump administration and something has to give. The US Dollar was softer, allowing the EUR to rally towards 1.1500, while the GBP held 1.3550.The softer reserve saw the AUD to trade around 0.6500, while the NZD consolidates above 0.6000. These trade dependent commodity currencies, may come under pressure, as the trade spotlight turns on them. They are yet to reach a trade agreement, with the US, and appear to be having political issues with the ‘Big Dog’. Nervous times are ahead.
