What you need to Know on Friday, August 2:
US President Donald Trump has spoken of a 10% increase in tariffs on $300 billion of imported goods from China. He says the negotiation process has not been fast enough, and his Chinese counterpart, Xi Jinping, has not fulfilled his promises of buying American agricultural products. Some believe Trump's actions are aimed at pressuring the Fed to cut interest rates again.
Demand for the yen and bonds has increased but stocks, oil and commodities have fallen.
The White House will issue a statement on tariffs on EU products, today. The EUR/USD pair is more stable and has benefited from the fall in US Treasury yields.
Trade tensions between Japan and South Korea have been heightened by the removal of Seoul from a list of reliable partners for Tokyo.
Sterling was stable after the Bank of England did not change policy rates and was hoping for soft Brexit, but the GBP/USD pair came under pressure after Boris Johnson lost his seat in parliament in a by-election.