Trump-Kim summit: what was agreed and what does this mean for the markets?

Brought to you by: ForexTime LogoYour capital is at risk

Pens poised and enormous signatures prepared, Kim Jong-un and Donald J. Trump sat in front of US and Korean flags at the unprecedented summit in Singapore. The summit marked the first time a sitting US president met with a North Korean leader and represented a clear break from the past. This is history in the making.

By 8:30am this morning, the two global superpowers had signed a declaration which will, in Kim’s words, result in “a major change” on the world stage.

During the 38-minute meeting, Trump and Kim productively discussed topics including denuclearisation, the recovery of POW/MIA remains and US-DPRK relations. Alongside these were more unproductive ventures into human rights, something Trump describes as “briefly covered”.

Despite both leaders looking pleased with the outcome, they were hesitant to reveal the juicy details of their joint declaration. At a press conference following the meeting, Trump argued that he had “no time” for details today. However, the main points covered on the “pretty comprehensive” joint declaration have been revealed. At the present moment, the two countries have sworn to:

  1. Foster brand-new US-DPRK relations and work towards peace and prosperity, in the interests of their respective peoples
  2. Work together to form a stable regime on the Korean Peninsula
  3. Commit to the complete denuclearisation of the Korean Peninsula, reaffirming the Panmunjom Declaration made in April this year.
  4. Work together to recover the remains of prisoners of war and those missing in action from the conflict between North and South Korea, and repatriate those already identified.

Following the meeting, critics raised concerns about the agreement’s fulfilment. At the press conference, a reporter asked Trump how he planned to ensure Kim followed through with his promises. Trump’s response that “you can’t ensure anything” did little to quell the concerns, but he claimed that Kim was keen to make a deal. As the conference came to a close, the US president’s own doubts about the completion of the declaration began to show. He concluded with the cryptic remark that “if you don’t get the ball over the goal line, it doesn’t mean enough”.

Concerns are particularly centred on Kim Jong-un’s agreement to work towards denuclearisation. The commitment may not be as strong as Trump first asserted – it is not the complete, verifiable and irreversible dismantlement (CVID) that Washington have long been pushing for. The document makes no attempt to define ‘denuclearisation’, and the agreement looks exactly the same as that made in the Kim-Moon summit in April.

So, what does this mean for the markets?

As the details from the meeting were released, the markets were optimistic. Despite the agreement’s frailty, the promise of a stable relationship between the US and North Korea was reassuring to investors. Appetite for risk continues to increase as investors focus on the smooth US-DPRK relations, instead of the rocky ties between the US and its allies after the G7 summit.

The dollar approached a three-week high and Asian shares rose as the agreement was signed. Chinese shares gained and South Korean shares weakened slightly. Elsewhere, markets showed mixed reactions. European shares stayed around the flatline, with the pan-European Stoxx 600 remaining steady.

The market reactions almost guarantee that the US Federal Reserve will implement another lofty interest rate hike on Wednesday. Aside from that, little else is certain. In the aftermath of the summit, the US military denied receiving any confirmation of Trump’s promise to cancel its military exercises in Korea. Recent reports suggest that North Korea is continuing its hacking efforts against the South. The markets, and the world, must wait to see if the promises made in today’s historic declaration are upheld.


Trade currencies with an innovative, global broker. Join FXTM today

Disclaimer: This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.

Risk Warning: There is a high level of risk involved with trading leveraged products such as forex and CFDs. You should not risk more than you can afford to lose, it is possible that you may lose more than your initial investment. You should not trade unless you fully understand the true extent of your exposure to the risk of loss. When trading, you must always take into consideration your level of experience. If the risks involved seem unclear to you, please seek independent financial advice.

Read more forex news

Are you ready to trade?

Sign up with ForexTime LogoYour capital is at risk

Latest news

AUD/USD in the 0.7350 Region, Jobs Data in the Spotlight
Quick Summary: Australian employment figures more buoyant than forecast AUD/USD hovering around 0. Read more
EUR/USD close to 1.1737 – what’s next for the euro?
The euro is floundering in the forex markets at the moment – and this trend was emphasised on Wednesday and into Thursday after the Federal Reserve meeting. Read more

Safest Forest Brokers 2020

Broker Info Best In Customer Satisfaction Score
#1 ForexTime LogoYour capital is at risk Founded: 2012 Global CFD and FX broker
Number One Broker
Best FOREX BROKER Visit broker
#2 Your capital is at risk Founded: 2012 Global Forex Broker
Number One Broker
Best Trading App Visit broker
#3 Forex Broker Pepperstone LogoYour capital is at risk Founded: 2010 Global Forex Broker
Number One Broker
Low minimum deposit Visit broker
#4 Your capital is at risk Founded: 2006 Globally regulated broker
Number One Broker
#5 BlackBull MarketsYour capital is at risk Founded: 2014 Global Forex Broker
Number One Broker
BEST SPREADS Visit broker

    Forex Fraud Certified Brokers

    skilling logo Logo
    XM Logo
    VantageFX Small Logo
    BlackBull Markets Small Logo
    LegacyFX Small Logo
    Oanda Small Logo
    OctaFX Logo
    Exness Small Logo
    Oinvest Small Logo
    HYCM Logo
    Plus500 Small Logo
    FXTM Logo
    City Index Logo
    ATFX Logo
    IQ Option Logo