The Sterling tumbled on Thursday after the Bank of England raised interest rates by 0.25% to a post-financial crisis high. The hike, which was initially planned for May prior to the first quarter slowdown, has not come without it criticism due to the mixed data, temporary factors driving some numbers and the uncertain outlook, associated with Brexit.

U.S. futures are pointing slightly higher again on Wednesday as indices look to extend the winning streak to three sessions on the back of strong earnings reports. Investors have been encouraged by the results we’ve seen so far, with lower taxes not the only thing providing a big lift to the bottom line, although they are obviously a considerable contributor.

Equity markets are trading slightly in the red at the start of the week, a reflection of the slightly risk-averse tone stemming from the prospect of the trade conflict escalating in the coming months.

It’s looking like being a quiet end to the trading week, with the only notable economic releases coming from Canada and it being one of the less eventful days of earnings season. The Canadian inflation figures will be one interesting takeaway today, after a year in which the central bank has been actively raising interest rates, most recently this month taking the number of hikes to four.

European markets are trading in the red early in the session on Thursday, with the FTSE 100 the only major index in the green, supported by weakness in the pound after the release of some more disappointing data for the UK.

It’s been a more positive start to trade on Thursday, with equity markets in the green and paring Wednesday’s losses as investors continue to weigh up what impact the latest trade tariffs will have on the global economy. While markets have typically reacted negatively to any escalation on trade, the overall impact has been relatively modest under the circumstances that suggest investors are far from panic mode right now.

Financial markets are once again in risk aversion mode on Wednesday, as investors continue to take shelter from the ongoing trade spat. There hasn’t been much progress – positive or negative – in recent days although U.S. Treasury Secretary Steve Mnuchin did deny reports that the country is looking to block investment from China in U.S. tech, instead claiming there will be a statement aimed at all countries trying to steal technology.

The week started with the US and China announcing tariffs against one another which will come into effect on 6 July, and it will end with the European Union announcing counter-tariffs against the world’s largest economy in response to those already imposed. While much of what has been announced this week was already anticipated, the rhetoric between these huge trading partners is heating up and that’s a major concern for investors.

U.S. markets are on course for another day in the red as we await the open on Tuesday, with futures down more than 1% as U.S. President Donald Trump threatens to intensify the trade spat with China.