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Trump ‘Winning’ with Trade Talks

Published July 1, 2019

By Rowan Murphy

Well the G20 has come and gone and the Aussie has held/gained ground. In what seemed an unlikely outcome just a week ago the Aussie has closed the quarter, yet again, above 0.7000…

G20 (unofficial) Outcomes:

  • Trump declared the U.S. was “winning” the trade war with China the day after reaching a temporary truce,
    • He said that he would hold off indefinitely on tariffs planned for an additional $300 billion in Chinese imports while allowing U.S. companies to continue to do some business with China’s Huawei, Trump said Xi had also agreed that China would buy large amounts of US agricultural goods,
  • Trump said at a news conference that the Fed Reserve “has not been of help to us at all” in regards the trade war, “Despite that, we’re winning, and we’re winning big because we have created an economy that is second to none”.

So what to expect from here? Well, it doesn’t all look like puppy dogs and rainbows from here as the cross approaches the top end of its year-long trend channel, following the bounce off the bottom in mid-June. With the full details and formal agreements to be reached between the US and China, what was spoken about, and what is finally agreed to, may be very different things.

Watch for a potential break of 0.7050 AUD/USD and 0.6200 for the AUD/EUR.

Tomorrow the RBA meets to decide Interest Rates and Markets are currently pricing in 78% chance of another cut at the moment.

 

Economic Calendar – Week Ahead