Finally, an agreement was reached in the commercial conversations between China and the US in London in the middle of the night. As expected, the currency market did not react strongly to the news, says FX analyst from Commerzbank, Michael Pfister.
Commercial Agreement between the US and China reached, the markets remain motionless
“First, as is the case, details are missing, and the announcement simply clarified that the agreement reached in Geneva only four weeks ago will now be implemented more effectively. This means that no new improvements were achieved in conversations; only the tensions that have arisen since the last agreement have been deactivated.”
“Secondly, this does not mean that tensions do not increase again in a few days. The US trade policy is so erratic that no market participant can predict whether a large range with China will be more difficult to achieve than expected, including new tariff threats, in a few days.”
“Given these perspectives, I can understand why any market participant could explode in jubilation after the announcement and trade the US dollar significantly stronger.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
