Forex: The Yen does not seem to believe in the appeasement of the trade war

The yen is up on Wednesday morning, despite the decision of u.s. president Donald Trump to defer additional customs duty on certain imports from China, the investors remaining skeptical about the prospects for quick resolution of the trade dispute.

The temporary respite in the commercial war that was supported Tuesday the risk-free assets, but analysts warn that optimism has already waned in the face of the resolution of the trade war between the two biggest economies in the world, which has threatened global economic growth.

The unrest in Hong Kong, the concern aroused by Brexit and the tensions in the Middle East means that risk aversion could quickly support new and weak markets.

“If we do not believe that the United States and China, the gains in dollars and the losses in the yen may be more important, but this does not mean that the trade irritants have been resolved,” said Tohru Sasaki, head of research on the japanese markets at JP Morgan Securities in Tokyo.

“There are still a lot of geopolitical risk, such as Hong Kong, Brexit and the situation in iran. I do not expect a significant move in (risk-taking).”

The dollar was down 0.26% to 106,45 yen at 11: 00 am.

The australian dollar has fallen 0.6% to 72,15 yen, while the new zealand dollar has lost 0.3% 68,71 yen.

Against the yuan offshore, the dollar rose 0.33%.

Trump has postponed Tuesday its cut-off date of 1 September, the fixing of customs duties of 10% on the chinese imports remaining, by deferring duties on mobile phones, laptops, and other consumer goods, in the hope of mitigating their impact on the sales in the United States.

Nevertheless, the trade negotiations between the United States and China have progressed in an irregular manner, which has led many investors and analysts to reduce their expectations about a near-term resolution.

The dollar index, measuring the greenback against a basket of six major currencies, was little varied at 97,58 after jumping by 0.4% on Tuesday.

The euro was up slightly, at 1,1178.

The single currency was little reaction to data showing that the German economy, the largest in the eurozone, contracted by 0.1% in the second quarter, under the effect of the fallout from the trade war.

The british pound was little changed against the greenback at 1,2067.

–Reuters contributed to this report

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