- US announces more tariffs on Chinese imports
- BOC to announce interest rate decision today
- NZD and AUD suffer in early trading
Just when markets appeared to be brushing off the tariff saga, the United States has rocked the boat and targeted China once again.
The Trump administration has decided to impose another $200bn worth of tariffs on Chinese imports. China has condemned this decision, and markets are now holding their collective breaths to see how they will respond.
The decision has already started affecting Asian markets. The USD index also found some support in recent trading, but that will likely face intense pressure once US traders enter the market later today.
The tariff issue has shifted the focus from other important matters, such as the BOC’s interest rate decision, the US PPI, and the speech of ECB President Mario Draghi.
The USD/CAD pairing will take center stage as the BOC gives its official position on interest rates later in the day. Markets expect an increase to 1.5%, but some critics think this will be bad timing considering the tariff issue.
The DAX have fared well given the negative news markets had to deal with, but it remains to be seen whether that will spill over to other global markets.
Bitcoin once again failed to break through the $6,800 level. There does not appear to be sufficient buyer interest, and it’s even possible that the BTC might fall back to $6,000 after this.
The NZD hasn’t done well in early trading today, even taking into account the tariff issue that has put pressure on the USD. The NZD and AUD traded about 0.4% to 0.5% lower as European markets started to open.
What happens next will largely be determined by how major markets react to the news of even more tariffs against Chinese imports.