FX Action: The yen has turned lower
FX Action: The yen has turned lower amid rallying stock markets in Europe after China's commerce ministry affirmed that September trade talks are not off the table. There was a palpable sigh of relief in markets after the Trump administration yesterday made official its extra 5% tariff on $300 B in Chinese goods imports, affirming collection dates of September 1 and December 15. U.S. Treasury Secretary Mnuchin had already said he is expecting Chinese negotiators to visit Washington, so confirmation from China that another round of talks are on has been tonic for investors. The AUD-JPY cross has seen the biggest magnitude of movement out of the main dollar pairings and associated cross rates today, showing a 0.3% gain on the day at prevailing levels, having been showing a decline of nearly 0.5% at the lows. USD-JPY rallied by nearly 50 pips in posting a three-day peak at 106.35 before settling. The dynamic has been driven by a paring back in the Japanese currency's safe haven premium. The Swiss franc has similarly declined against the euro, dollar, and most other currencies.