The recent escalation in trade tensions between the US and China has led to a surge in the US dollar, as investors seek safe-haven assets amid uncertainty. China's retaliatory tariffs and a probe into Google have heightened market volatility, impacting global currencies and equities. The Australian and New Zealand dollars have weakened significantly, while the euro and pound have also retreated. US index futures have reversed early gains, reflecting concerns over potential economic growth and corporate earnings impacts.
In the commodities market, crude oil prices have declined, driven by fears of a slowdown in global trade and economic activity due to the ongoing tariff disputes. The stability of Treasury yields suggests that investors are balancing economic risks with inflation concerns, with no immediate changes in monetary policy expected. As of 00:51 on February 4, WTI crude is trading at $71.89, down from its last close of $73.16, reflecting the market's cautious stance amid geopolitical uncertainties.