The Japanese yen is making gains against the US dollar as hopes for a partial trade deal between the US and China fade once again. At the time of writing, USD/JPY is trading at around 108.70.

Safe haven currencies like the Japanese yen and the Swiss franc are once again in favor after trading weaker over the recent few weeks as markets once again temper their expectations for a resolution in the US-China trade war. According to news reports, negotiations between the trade teams faced some obstacles over farm purchases as China raised concerns about signing a one-sided deal tilted towards the US.

Meanwhile, Trump reiterated his threat of the next round of tariff hikes on Chinese goods if the trade deal signing gets delayed further. The “Phase 1” trade deal was initially expected to be signed in mid-November but there have been no confirmations from either side that all concerns have been addressed.

The Japanese yen is also strengthening on account of ongoing protests in Hong Kong which have markets on edge. Japan’s GDP came in at +0.2% for the period between July and September, well below economists’ expectation for a reading of +0.8%. However, this disappointing GDP data release also failed to move the yen, as the trade war sentiment remains in focus.