Is it possible that G-20 meeting is the beginning of a currency war

The dollar recovered yesterday after Bullard noted that a 50 basis points reduction in interest rates could be too much. However, the dollar index still stands below 200 MA technically looking for shorts.

Additionally, the Fed has already changed its position from "let's wait" to "we'll downgrade," which keeps the green currency under pressure. Looking ahead, most other central banks are likely to follow in the footsteps of their colleagues, as RBNZ commented that such a move would be very appropriate for them. They also change their rhetoric by "we will only be down once" until "the door for further changes is wide open".

When Mario Draghi of the ECB pointed out that lower interest rates could be attracted to the euro, US President Donald Trump did not hide his irritability in Twitter. US Treasury Secretary Mnuchin accused China of devaluing the yuan to offset the tariff effects at the G20 meeting of central banks and finance ministers. The US has introduced anti-subsidy duties on products from countries that underestimate their currencies. Target economies are those with large trade surpluses such as Europe, Japan, China and Korea.

So, if Trump focuses on devaluation, then there might be a currency war that would trigger a bottom race for many of the major currencies. The G-20 may be the place to start it all.

Read more:

• NZD/JPY – Short with the main movement after a price action signal
• Jeffrey Gundlach: “USD’s next move is going to be down”
• Here’s a cable forecast for $1.40 till end of 2020
• NZD to 0.59 at end of Q1 2020
• Support for risky currencies as trade war hopes grow