USD: Having been primed more than a week ago to expect tariffs on another $200 billion of imports from China, investors were not exactly shocked when the US administration announced exactly that on Monday evening. If anything, they were relieved that the tax would be 10% instead of 25%, at least until the New Year. Their first knee-jerk reaction was to buy the USD. After due consideration they decided the tariffs were not, after all, dollar-positive and they marked it down. The USD was one of the day's weakest performers, losing half a cent to the EUR.
EUR: The euro did nothing to deserve the half-cent which it took from the USD. Euro zone consumer price index numbers were exactly on target, headlining a 2.0% rate with core inflation - excluding food and fuel - also unchanged at 1.0%. European Central Bank Governing Council members Benoît Cœuré and Peter Praet both managed to make speeches that had not the slightest impact on the EUR. The currency was unchanged against the GBP and CHF.
CAD: Largely because the USD had a losing day, the CAD had one too. In the same way that the EUR did nothing particularly right, the CAD did nothing egregiously wrong, other than to be in the collateral damage zone of the Trump trade war. The only Canadian statistics were for inward and outward investment in securities. They were not exactly helpful: Canadian investment abroad exceeded foreign investment in Canada. But the numbers were much as expected.
GBP: Sterling is still surviving on investors' optimism that Theresa May's government will strike a bargain with the EU for a post-Brexit trade agreement. If anything, that optimism has increased over the last few days as the prime minister has appeared to gain greater authority over the ultra-Brexiteer faction within her party. She has a meeting with EU leaders in Salzburg, Austria, later this week and supporters of the GBP are hoping for her to bring home from it some sort of prize. GBP had a comfortable day, adding three quarters of a US cent.
JPY: With the yen it was a case of the dog that didn't bark. Traditionally, escalations in the trade war spark a flight to quality among investors, as they abandon risky currencies and take shelter in the "safe-haven" CHF and JPY. There was no sign of that following yesterday's tariff announcement. Investors are clearly not (yet) too worried by the development. The JPY performed no better than the USD and CAD on Monday.