China ‘will honour’ US trade war deal promises as talks progress ‘in earnest’

In a weekend article, The South China Morning Post reports that the "Chinese ambassador says there is no problem with Beijing meeting its phase one commitments, but US must also live up to its vows on issues such as Taiwan."

The article also reports that "US President Donald Trump said that he and Chinese President Xi Jinping would meet to sign the phase one deal, but China has yet to confirm this."

However, the article goes on to say, "despite some relief with the phase one deal, overall bilateral tensions remain high. China has accused the US of interfering in Hong Kong, Tibet and Xinjiang, and of challenging Beijing on the self-ruled island of Taiwan."

FX implications

AUD is a compelling trade considering the technical picture, the improved economic data of late (jobs data) cs the RBA's dovish forecasts and the likely need of QE for the first time. However, the trade dal between the US and China coming along nicely is keeping the bid alive in the Aussie, supported by the undertones of a phase-one deal in the making and a stronger commodity complex. 

More to come...