US Sends Two Aircraft Carriers to South China Sea for Exercises as China Holds Drills Nearby – WSJ

Ross J Burland FXStreet

The Wall Street Journal has reported this weekend that the US is sending two aircraft carriers into one of Asia’s hottest spots to deliver a pointed message to China that it doesn’t appreciate Beijing’s military ramp-up in the region.

The USS Ronald Reagan and USS Nimitz are set to hold some of the US Navy’s largest exercises in recent years in the South China Sea from Saturday—at the same time that China is holding drills in the area.

"The purpose is to show an unambiguous signal to our partners and allies that we are committed to regional security and stability," Rear Admiral George M Wikoff was quoted as saying by the Wall Street Journal, which first reported the exercises.

Market implications

This is just another headline in a long laundry list of antagonistic tactics from either country, stoking the flames surrounding strained relations over everything from coronavirus to trade to Hong Kong – risk-off is the playbook over such themes and AUD/USD trades as a proxy to such news.

Chart of The Week: AUD/USD traders enter the barroom brawl

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD turns south toward 0.6900 as USD firms up

AUD/USD sees fresh selling and drops toward 0.6900 in late Asian trading on Monday, as renewed US Dollar strength weighs on the pair amid lingering Middle East and Russia-Ukraine geopolitical tensions. Focus remains on Oil prices, Treasury bond yields, and RBA expectations for fresh trading impetus in the major.

USD/JPY retakes 158.00 amid hawkish BoJ bets, firmer USD

USD/JPY erases losses and retakes 158.00 in the Asian session on Monday, trading within a one-week-old range. Geopolitical uncertainty continues to underpin the US Dollar, despite fading Fed rate hike hopes, supporting the pair's rebound. However, further upside could be capped by hawkish BoJ expectations and looming intervention risks that could support the Japanese Yen.

Gold languishes below $4,200 amid high US yields

Gold trims some losses on Monday, but remains trapped within previous ranges, with upside attempts limited below $4,200 and with two-month lows of $4,110 at a short distance. The recent pullback on the US Dollar Index has provided some support for precious metals although the high US Treasury yields are keeping a floor on US Dollar dips so far.

Pi Network risks a steeper decline as bearish momentum builds

Pi Network extends losses below $0.090 maintaining a steady decline for the fifth consecutive day. The retail demand remains firm, with the notional value of active perpeutals holding above $10 million. The technical outlook for PI remains bearish as bearish momentum mounts.

ISM Services PMI expected to show robust US economy in September

The US ISM Services PMI is expected to improve marginally in September. The US services sector is expected to remain well into expansionary territory. Bets of further Fed tightening appear to have lost traction in the last few days.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.