Safe Havens Retreat on Trumps “Phase One” Deal Comment, but Risk Assets Are Hesitating
The trade deal is driving everyone mad. Brexit too. In the last two weeks we have heard so many contradictory statements from US and China. The odds of the “Phase One” deal decreased in the last few days, but a while ago we heard US President Donald Trump say that they are very close to signing the “Phase One”deal.
That sent safe havens lower, with GOLD losing more than $7. USD/JPY jumped higher as the JPY weakened. Another reason for the bullish move in USD/JPY were the better-than-expected manufacturing and service PMI reports, which showed that these sectors moved away from contraction.
But, stock markets and other risk assets such as commodity Dollars arte not taking advantage of the improvement in the risk mood. That’s a sign that traders are not certain yet if this partial deal will finally make it through. So, traders have unloaded their long positions on safe havens, but are not turning to risk assets. When risk assets make a strong move higher, that will be the sign that the deal is finally official
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