Cancellation of the APEC summit in Chile is not a big obstacle for China and the US to sign a trade deal - GT
|- Cancellation of the APEC summit in Chile is not a big obstacle for China and the US to sign a trade deal.
- So long as a trade deal is on the cards - risk on will be the theme.
The Global Times has tweeted that the cancellation of the APEC summit in Chile is not a big obstacle for China and the US to sign a trade deal as long as they reach one, according to Mei Xinyu, an expert affiliated with the Chinese Commerce Ministry”.
- If China and the US were to sign an interim trade deal, as they appear to do so, and top leaders of the two countries were to meet for a signing ceremony, it would be in a neutral third-party country: Mei Xinyu.
FX implications:
Neutral/Bullish for risk and supportive of AUD crosses. The Aussie is the one to watch with respect to trade war – China is Australia's largest trading partner in terms of both imports and exports and Australia is China's sixth-largest trading partner and a two-way investment relationship is also developing. The Yen is also one to watch, as investors scramble from risk asset allocations at times of uncertainty when the Yen picks up a safe haven bid.
So long as a trade deal is on the cards, investors will seek a higher return on their capital and thus, AUD/JPY should attract demand - AUD/JPY is currently higher by +0.14% on the day so far. (AUS Consumer Price Index was favourable for AUD overnight, in line with expectations and not poor enough to cement a Reserve Bank of Australia rate cut.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.