Monday’s trading session saw a mildly firmer US dollar, accompanied by rises in both stock and oil markets. Market chatter about the prospect of President Trump placing new tariffs on China is beginning to surface. Donald Trump is angry about China’s role in allowing Covid-19 to spread so vastly and the lack of communication they offered.
US President is applying pressure on China to take a certain portion of the blame for not doing more to prevent the spread of Coronavirus. For the moment, both currency and stock markets are doing a good job of ignoring the ramp-up in heated rhetoric but if it does continue, investors may begin to pay attention. Another trade war is the last thing the global economy needs at present.
In the UK today, both construction and services PMI for April will be released this morning. The afternoon session will be where the majority of participants place their focus, with the latest dose of US ISM numbers. This is a key report from the perspective of the market with an emphasis on the non-manufacturing component. The readings will be released at 3 pm and should ensure the buck remains lively into the afternoon session.
Overnight, the Reserve Bank of Australia held interest rates steady at 0.25% at their latest monetary policy announcement. The accompanying statement provided enough positivity to help find buyers for the Aussie dollar.
Written by Viv Savani. 8:33am, May 5th 2020
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