Overnight Indonesia secured a trade deal with the USA, following other Asian giants, China and Vietnam. The deal is agreeing to a carte blanche 19% tariff, on all exports to the USA, while opening their market to US exports. This is great news for global trade and also shows momentum heading towards the deadline of August 1st. US inflation jumped to 2.7%, from 2.4%, but failed to move markets as it was in line with expectations. This is a number that could be used by the Fed, to hold rates ‘higher for longer’, but Trump appears to have other plans for the Fed Chairman. The US Dollar jumped higher, with the EUR tumbling below 1.1600, while the GBP slumped to 1.3380.The rising reserve continued to impact commodity currencies, with the NZD plunging to 0.5940, while the AUD heads back towards 0.6500. Trade deals with the USA remain elusive and both these Countries need to act fast. They have a political problem, as both Governments appear to have strained relations, with the Trump administration.
