U.S. and Chinese trade negotiations remain the focus of attention in the financial market
The United States and China relations deterioration
Flat on the currency market
The U.S. and Chinese trade disagreements continue to have the strongest impact on the financial market dynamics. Many media, citing sources familiar with the course of the negotiations, report significant disagreements between the parties on the issue of removing previously imposed trade restrictions. Investors are afraid of the negotiations failing and are once again focusing on traditional protective assets.
Trading in the currency market is very quiet. Major currency pairs are traded in a limited price range. The growth of volatility was observed only on Friday against the background of the publication of important economic data.
Weak PMI indicators of services and production sectors in Great Britain put significant pressure on the pair GBP/USD, which renewed weekly lows of trades. At the same time, the main attention of investors is still focused on domestic political events. According to media reports, Boris Johnson's Conservative Party is about 10% ahead of the Labor Party in the pre-election race.
The EUR/USD pair spent the whole week in a narrow range, not exceeding 50 points. Investors are being very cautious in the conditions of general economic and geopolitical uncertainty.
Precious metals market
Gold is traded in a narrow range. During the week, the quotes were supported by the situation on the stock exchanges, where the main indices were traded mainly in the red zone. The deterrent for gold is the U.S. dollar, which holds a dominant position in the foreign exchange market against the background of signals from the Federal Reserve to suspend the cycle of interest rate cuts.
In the first half of the week, the oil market was trading with a decline. The price was pressured by reports of possible trade negotiations disruption between the USA and China. On Wednesday and Thursday, the market was able to recover its lost ground due to the publication of more positive data from the U.S. industry statistics.
World stock indices finished the trading week’s movement in different directions. Investors react very painfully to any reports about the course of trade negotiations between the USA and China. Relations between the two countries became more strained after the U.S. Senate passed the bill on the protection of human rights in Hong Kong.