Asia FX Handover: Tariff Man Pepper Sprays Mexico
Matt Simpson May 31, 2019 4:32 AM
A summary of news and snapshot of moves from today’s Asia session.
- Another risk-off session fuelled by growth concerns and trade wars.
- Tariff Man (aka Donald Trump) said he’s to place a 5% tariff on Mexican goods from the 10th June until Mexican immigrants stop crossing the border illegally. The levy would then be increased gradually until the ‘problem’ was solved.
- The Mexican peso is within its most bearish session since October. CAD (the FX major’s proxy for MXN) is today’s weakest major and JPY and CHF are the strongest.
- China’s manufacturing PMI contracted more than expected at 49.4 (49.9 forecast) and down from 50.1, making it’s the 4th contraction in 6 months. Another own goal for global growth.
- We see a glimmer of light for gold which hit a 2-week high and WTI touched $56 to carve out a new range for oil bears to fade into.
- Indices are expected to open lower with futures markets headed south, on the back of Trump’s latest tariffs and weak China PMI data.
- China are reported to have a plan in place to limit sales of rare earth materials in place ‘if necessary’.
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