Tageskommentar | 14/08/2019

Financial Markets find relief in tariff delay announcement

Yesterday the US announced the delay of 10% tariffs on some Chinese products including cell phones and laptops until mid-December 2019. According to reports the US reached out to China this time and this was celebrated as a victory by the Mainland. Various analysts believe the so-called currency manipulation had played its role in the US decision to ease its approach. Also US Donald Trump has taken criticism on the latest action, as some believe he has revealed a vulnerable spot to the Chinese side, which could be exploited. However, positivity also came from the fact that the two sides were in talks behind the scenes and away from the public view which creates extra pressure at times. The event was unexpected and was able to overturn doubt to a more optimistic view for the future relations of the two largest economies of the world. Both the US dollar against the yen and the S&P500 moved higher upon the news of more talks and tariff delays. Interesting was a report released by Moody’s that stated the situation improved temporarily, and that more up and downs could prevail in the near future. After the news, the case for a possible deal returns. The U.S. dollar and Chinese Yuan rose while Crude Oil prices gained $2 upon the news.

UK Employment data wows

UK wages increased significantly in the latest quarter to June and employment growth has outperformed expectations. Brexit uncertainty remains yet the strong employment report is very positive for the economy at the moment. Compared to the total amount of jobs created, self-employment is at 30% and women account for 75% of the hiring’s. A strong employment report indicates the economy is in a healthy state and still has the economic power to sustain growth. Furthermore, Britain and the United States are in talks to form a trade deal that could take effect on Nov. 1 which is 1 day after the exit from the EU. Even though, PM Boris Johnson has vowed to leave the EU with or without a deal, various important figures in the UK scene are trying to convince him to get a deal. This is in indication that a Brexit deal could still be on the table as the uncertainty of a hard Brexit creates a fears and some may seek to avoid it.

USD/JPY H4

• Support: 106.00 (S1), 105.30 (S2), 104.65 (S3)
•Resistance: 106.60 (R1), 107.20 (R2), 107.80 (R3)

US500Cash H4

• Support: 2935 (S1), 2955 (S2), 2980 (S3)
•Resistance: 2910 (R1), 2865 (R2), 2865 (R3)