This week started in the worst manner with risk assets opening with a big bearish gap lower and continued to crash lower during the first few trading hours after Donald Trump escalated the trade war again, raising tariffs by another 5% on China. But the situation has improved this week.

It was Donald Trump who offered the hand first when he left it to China whether to continue trade talks or not. The Chinese seemed interesting for negotiations to continue and we heard some positive comments from both sides in the past few days.

Today, Chinese officials are continuing with positive comments. Here are some of their remarks from China’s foreign ministry spokesman, Geng Shuang:

• US-China trade teams are maintaining effective communication
• China is on course of trade talks in September

These comments have improved the sentiment further today and safe havens have stretched their retrace lower a bit further. US officials made similar comments in the last couple of days, but the thing is that we have heard such positive comments before and things have gotten worse. Although, let’s see if this sentiment will continue further or perhaps we will see a run for safe havens towards the close of the week.