Forex today witnessed a cautious start to a big week ahead, with softer risk tones persisting amid global growth concerns sparked by escalating trade wars. The manufacturing sector activity deteriorated in Japan and South Korea while held steady in China. Therefore, traders opted to hold the safe-havens such as the Yen and Gold at the expense of the risky bets.

Despite risk-aversion, the US dollar slipped further into the red zone across its main competitors amid dovish comments from Fed’s Daly and increased bets of a Fed rate cut by end-2019. USD/JPY fell to fresh 4.5-month lows and tested the 108.00 handle while EUR/USD and the GBP/USD advanced amid falling Treasury yields and ahead of the US President Trump’s UK visit.

Markets gear up for a busy EUR calendar ahead following an eventful Asian session. A slew of Euro area final manufacturing PMI reports that started trickling in from 07:15 GMT. The main manufacturing PMI readings from Germany, Eurozone and the UK will gain market attention amid ongoing trade tensions and Brexit uncertainty.

The NA session also sees the releases of the US Markit manufacturing PMIs due to be reported 13:45 GMT respectively, soon followed by the US ISM manufacturing PMI for May at 14:00 GMT. At the same time, the US construction spending report for the month of April will be also published.

Oil prices extended losses on Monday after a 3% slump last Friday amid tension between Mexico and the U.S. Tariff on Mexican imports, larger-than-expected crude inventories data, and an escalating trade war between the U.S. and China were all cited as catalysts for the drop in oil prices.

Gold prices reached ten-week highs above $1,310 on widespread risk-aversion and dovish US interest rates outlook. Rising speculations of the Fed rate cut offer additional strength to Gold, while positive news concerning the US President’s refrain from levying tariffs on Australia and the Mexican President’s readiness to abide by the US demand over migration had little impact to dim risk aversion.