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  • Commodity currencies down with Chinese stocks on trade war fears
  • BOJ holds policy unchanged, Yen might rise as risk aversion deepens
  • UofM measure of US consumer confidence expected to rise in June

Trade war jitters look set to reclaim the spotlight in the final hours of the week. The sentiment-linked Australian, Canadian and New Zealand Dollars fell alongside stocks in China as the US prepared to release a list of goods from the East Asian giant that will be subject to a new $50 billion round of tariffs.

Broader risk aversion is yet to take hold. Bellwether S&P 500 futures are treading water and the anti-risk Yen is trading flat, though the latter may reflect another firmly dovish policy announcement from the Bank of Japan as much as the absence of a concerted risk-off push.

A re-examination of last weekend’s contentious G7 leaders’ summit now that more immediately pressing scheduled event risk (Trump/Kim summit, FOMC, ECB) has passed might amplify concerns. Indeed escalating tensions between the world’s top economies seems hardly uplifting for investors’ mood.

BACKGROUND: A Brief History of Trade Wars, 1900-Present

On the data front, the University of Michigan measure of US consumer confidence is expected to tick higher after two months of moderation. This seems unlikely to mark a meaningful offset if risk-off capital flows gather legitimate momentum however.

In such a scenario, the Yen stands out as the most obvious beneficiary amid the unwinding of carry trades. The US Dollar may likewise rise as the dour mood burnishes its liquidity haven credentials. Commodity bloc currencies are likely to continue facing outsized selling pressure.

See our free guide to learn how to use economic news in your trading strategy!


Asia Pacific Trading Session Economic Calendar


Yen May Rise as US, China Trade War Fears Sour Market Mood

** All times listed in GMT. See the full economic calendar here.


--- Written by Ilya Spivak, Currency Strategist for

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