Once again currency price action in the majors has been particularly subdued in the past 24 hours, with the Dollar only marginally for the second consecutive session. The US announced today that it was introducing 10% tariffs on a further $200bn of imports from China which markets seemed to largely take into their stride particularly as the list of Chinese goods impacted was narrower than initially feared.
However, the US said it could increase the tariff to 25% in the new year and could eventually target the totality of US imports from China. This escalation in the US-Chinese trade war and the release yesterday of a weaker-than-expected NY Empire State manufacturing index for September have taken the shine off a US economy and a Dollar which until recently seemed bullet-proof.
The EUR/USD and GBP/USD crosses have largely treaded water with little new news for markets to sink their teeth in. ECB President Draghi spoke today but did not comment on the Eurozone economy or monetary policy and in the UK the avalanche of Brexit-related news has net-net had little impact on Sterling or UK equity markets.
