Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
US Dollar, S&P 500 Spike Lower As China Announces Tariff Retaliation

US Dollar, S&P 500 Spike Lower As China Announces Tariff Retaliation

Justin McQueen,

Trade War Analysis and Talking Points:

  • China to Raise Tariffs on June 1st
  • Tariffs to be Raised to 25% on $60bln of US goods

See our quarterly FX forecast to learn what will drive prices throughout Q2!

China have announced that they will raise raises to 25% on $60bln worth of US goods from June 1st in retaliation to the United States decision to raise tariffs to 25% on $200bln worth of Chinese goods. In regard to the details, the Chief Editor of Global Times noted that China may stop purchasing US agricultural products and energy, while also reducing US service trade with China.

In reaction to the announcement by China, US equity futures tumbled with the S&P 500 down 1.8%, while the US Dollar also dropped. As Chinese press noted that scholars are reportedly discussing the possibility of dumping US treasuries, which in turn, took the USD and US yields lower. Consequently, as the tensions between the US and China continue to escalate, money markets have raised their expectations of a Fed rate cut with 35bps worth of easing priced in by January 2020.

At the same, the US 3-month/10yr yield spread has once again inverted with the New York Fed indicator highlighting that there is a 27% likelihood of a US recession with the next 12-months.

Source: New York Fed

S&P 500 Price Chart: 1-Minue Timeframe (Intra-day)

US Dollar Price Chart: 1-Minute Time Frame (Intra-day)


--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at

Follow Justin on Twitter @JMcQueenFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.