Currency Market Analysis

Aug 26, 2019 | Currency Market Analysis

Global Themes

USDSGD at two-year highs after tit-for-tat trade moves

The greenback surged versus a range of currencies after Friday’s fresh salvo in the US-China trade wars.

In Friday’s early European trading, China announced a series of new tariffs on US$75b of US imports including cars and trucks.

Later, US President Donald Trump said he would raise planned tariffs due to be introduced in September and October.

Safe havens

The trade news saw global markets shudder with the US’s Dow Jones index down 2.4%.

The safe haven currencies outperformed with the US dollar and Japanese yen strongest.

Currencies exposed to global trade, like the Australian and Singapore dollars, both fell.

The USDSGD jumped to the highest levels since May 2017.

US data

From overseas, tonight’s US durable goods and Thursday’s June-quarter GDP will be key with the US economy apparently slowing.

In China, manufacturing and services activity gauges are both due later in the week.

From Australia, the focus turns to next week’s GDP numbers with capital expenditure due on Thursday likely to be seen as a first guide to this critical number.

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