Foreign Exchange Daily Market Update 10/04/18

Tue, April 10, 2018

U.S.-China talks halted over tech industry.

Trade talks between the US and China broke down last week after the Trump administration demanded that China take steps to cut back support for high-tech industries, a person familiar with the situation said.

China vice premier Liu He who is overseeing economics and finance, told a group of officials that Beijing had rejected a U.S. request to stop subsidizing industries related to its “Made in China 2025” initiative. The U.S. claim China of using the policy to force companies into transferring technology in areas like robotics, aerospace and artificial intelligence.

The U.S. demands came after Beijing offered to tighten the trade deficit by $50 billion, including by importing more liquefied natural gas, agricultural products, semiconductors and luxury goods. The plans also included opening the financial sector at a faster rate and giving U.S. companies more access to China’s booming e-commerce market.

China’s President said they were ready to fight back hard if U.S. counterpart Donald Trump wanted a trade war. China was open to talks with the U.S. but wouldn’t initiate them under the current conditions.

Trump was optimistic about a deal with China, saying his administration are hopeful the dispute would be resolved as fear of a major economic conflict between the world’s biggest economies.

The Pound rose to 1.415 this morning against the dollar. Sterling jumped to 1.148 against the euro

Data to look out today.   

Not much data due out today.

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