Trade tensions have been rising every passing day which is affecting the forex trading platform. The effect has been felt everywhere in the market since the threats turned to reality. Earlier this year, President Donald Trump’s administration announced imposing tariffs on aluminum and steel. Target countries included the European Union (EU) markets and China that are prominent producers of steel worldwide. The notice came by surprise to many of the United States trade allies as well as some politicians in America.
Investors have been shunning away from risk in the forex trade as currencies continue to lose value in the market. Forecasters warn of greater impacts and effects should this continue, risking business and the economy. Recently, German received an increased levy on their cars just when the Merkel government is struggling with immigration issues. However, the tensions are favorable to some currencies such as the Japanese Yen that continues to rise against the greenback significantly.
Today, the forex platform was all about trade tensions with the increasing threats and protective measures from Washington. These continue to intensify weighing on the upper betas generally while a slowdown of the increased trade plays out. The US trade allies in response to the tariffs by Trump warned of raising taxes on specific US commodities. The EU announced targeting particular products such as motorbikes among others in retaliation. Trump, having imposed the levies, forced his allies to pose trade barriers in retaliation to the tariffs. In retaliation, President Donald Trump has again threatened China and the EU to withdraw these barriers, failure to which there will be severe consequences.
Among the new threats, the administration will add tariffs to Chinese tech firms. According to a report from the Wall Street Journal, the Trump administration plans to stop Chinese tech industries from investing in American tech corporations. Additionally, Beijing’s tech exports will be blocked. Currencies continue to deteriorate in value against the USD in the Forex space recording a significant fall with the Euro in New York closing at 1.1703. Ahead of the EU Summit, GBP/USD was stable then uneven to the top closing at 1.3280. On the NY session at +0.13% within the N. American range of 1.3289 to 1.3251.
Oil was lower besides copper that in the June rout was nose-diving. For the first time since late last year, gold recorded a close beneath the 200-D SMA. The Aussie nosedived to 0.7397 from 0.7440 ranking it as one of the most underperforming commodities. However, Kiwi hiked from 0.6901 to 0.6890 in the equity market.