U.S. Action Against Chinese Super-Apps Knock Risk Sentiment

U.S. President Trump hit risk appetite with a double whammy, as he signed off on two executive orders targeting TikTok and WeChat. The POTUS banned U.S. residents from doing any business related to the apps, starting 45 days from now. USD and JPY picked up a bid on the back of safe haven demand and comfortably outperform their G10 peers.

• The redback took a beating, with USD/CNH rallying above the CNH6.9500 mark and virtually erasing Wednesday's slump. Further losses in the yuan were prevented by a healthy and above-forecast trade surplus reported by China. The figure was underpinned by an unexpected jump in exports. Furthermore, the PBoC announced that it will auction CNH20bn worth of 3-Month Bills & CNH10bn worth of 1-Month Bill in Hong Kong, but even in combination with upbeat trade data, the announcement failed to outweigh Sino-U.S. turmoil.
• No surprises in the RBA's latest SoMP, which largely reiterated the central bank's latest communique. The document reiterated the RBA's view that AUD trades in line with fundamentals and an FX intervention would have limited effectiveness. AUD/USD edged to a fresh YtD high early in the session, before retreating towards the $0.7200 figure.
• NOK underperformed in G10 FX space, due to the increasing risk aversion.
• Focus moves to U.S. NFP report and the Canadian counterpart, German, French and Norwegian industrial outputs, German and French trade figures, as well as comments from Fed's Rosengren.