EU Trade Commissioner Sefcovic says the bloc will stand its ground, following on from China threatening retaliatory measures over industrial policy plans.

The EU's commitment to stand firm against China's threats indicates a potential escalation in trade tensions, which could lead to retaliatory measures. This situation may create volatility in forex markets, particularly affecting the euro and the dollar, as investors reassess geopolitical risks and trade dynamics. As the landscape shifts, watch for how these developments might impact risk sentiment towards safe havens and trade-exposed currencies.