At the end of the week, a new round of escalation of the trade war between the United States and China took place. Recall that at first China introduced additional duties on the import of goods from the USA of $ 75 billion. In response to this, US President D. Trump raised the tariff for importing Chinese goods of $ 250 billion from 25% to 30%. The decision will enter into force from October 1. The remaining $ 300 billion worth of goods will be taxed at 15% (not 10% as previously planned) from September 1, Trump added.
This increase in tension instantly triggered an escape from risks, and over the weekend the markets continued to recoup this topic, seeking salvation in safe assets.
As a result, the new week began with large-scale gaps reflecting increased demand for such safe harbors as the yen, treasury and gold, and the players’ withdrawal from risky assets like oil, stocks, and currencies-antipodes.
USD / JPY opened with a bearish gap and updated multi-year lows at 104.50. The crosses that involved the yen also declined everywhere. Ozzy tested the area at 0.67, while the Qiwi dipped to 0.6341. Gold opened with a large bullish gap and rushed above 1550 USD, although it is now trading in the area of 1542 USD.
However, subsequently, the markets managed to calm down a bit against the background of China’s comforting assurances that the country is opposed to an escalation of the trade war. This allowed the USD / JPY to jump to almost 105.80, (although the pair immediately rolled back in the direction of the level of 105). AUD / USD tried to test the 0.6750 area. As for the euro and the pound, they held the Asian session in narrow ranges.