There was little lasting reaction to yesterday morning’s reports of a truce in the long-running trade dispute between China and the US. Elsewhere, the Euro remained flat following the release of data indicating weak Business & Consumer sentiment indices for June.
Because in both cases, concrete political decisions and wider policy aspects, respectively, are the real elephants in the room - regardless of which way any data releases or news point.
The G20 meeting which kicks off today may be the key event of the week with the real focus will be on the Sino-US relationship. The escalation in trade tensions between the two, and in particular last month’s breakdown in negotiations on a trade deal, has done much to fuel the current round of global angst.
US President Trump and Chinese President Xi are set to hold a private meeting at this week’s gathering. It will be hoped that at the very least it results in some thawing of relations and that talks between the two sides resume. The Middle East is also likely to be high on the G20’s agenda following the rapid rise in tensions between the US and Iran. The Americans were reported to be on the brink of bombing Iran on Thursday but then stepped back.
Even so, the reports were enough to send the oil price up to a three-week high.
In the UK the result on who will be the new Prime Minister is expected in the week beginning 22nd July, which gives markets almost another full month to speculate on the potential implications for Brexit.
See you next week!
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