The U.S. Dollar was on the back foot on Wednesday. China is set to hit the U.S with fresh trade tariffs of the amount of $60 billion. The market reaction was however largely muted.

The British Pound was hit by a bout of negative sentiment. The currency weakened against the Dollar and the Euro as investors grew concerned about a no Brexit deal. The Euro was seen rising to a nine-month high. The sentiment increased as the UK’s international trade minister, Liam Fox said that the odds of a no-deal Brexit had increased significantly.

The RBNZ held its monetary policy meeting during the overnight session. The overnight cash rate, OCR was left unchanged as widely expected. The RBNZ’s monetary policy statement also did not see any major changes.

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Earlier today, China’s inflation data showed that consumer prices advanced 2.1% on an annualized basis in July. The data beat expectations of a 2.0% increase and was higher from 1.9% since June.

Looking ahead the U.S. will be reporting on the Producer Prices Index data. Consensus for the PPI is at 0.2% on both the headline and core PPI measures. The weekly unemployment claims report is also due later today too.

The markets are expected to be relatively quiet during the European trading session with no major releases scheduled.

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