It was another topsy-turvy day in the financial markets, as investors reacted to global trade headlines while major currencies had their fair share of top-tier catalysts.
Here are the updates from the latest trading sessions:
Headlines:
- New Zealand Food Price Index for March 2025: 3.5% y/y (2.2% y/y forecast; 2.4%y/y previous)
- U.K. BRC Retail Sales Monitor for March 2025: 0.9% y/y (0.7% y/y forecast; 0.9% y/y previous)
- RBA March Meeting Minutes: Described risks to growth and inflation as two-sided, decided against premature policy easing despite trade headwinds
- Germany Wholesale Prices growth rate for March 2025: -0.2% m/m (0.4% m/m forecast; 0.6% m/m previous); 1.3% y/y (1.8% y/y forecast; 1.6% y/y previous)
- China halted deliveries and orders of Boeing aircraft from the U.S. amid a tariff spat
- IEA slashed global oil demand forecasts for 2025 from 1.03M bpd to 730K bpd
- Reports revealed that the EU and the U.S. made limited headway in resolving their trade disputes, as a majority of tariffs on EU goods are likely to remain in place
- U.K. Claimant Count Change for March 2025: 18.7k (25.0k forecast; 44.2k previous); unemployment rate steady as expected at 4.4% in February 2025, average earnings at 5.6% (5.7% forecast, previous reading downgraded from 5.8% to 5.6%)
- France Consumer Prices Index growth rate (Final) for March 2025: 0.8% y/y (0.8% y/y forecast; 0.8% y/y previous); 0.2% m/m Final (0.2% m/m forecast; 0.0% m/m previous)
- Germany ZEW Economic Sentiment Index for April 2025: -14.0 (9.0 forecast; 51.6 previous)
- Euro area ZEW Economic Sentiment Index for April 2025: -18.5 (11.5 forecast; 39.8 previous)
- Euro area Industrial Production for February 2025: 1.1% m/m (0.1% m/m forecast; 0.8% m/m previous); 1.2% y/y (-0.6% y/y forecast; 0.0% y/y previous)
- White House said that trade deals are about to be announced “very soon”
- Canada Housing Starts for March 2025: 214.2k (220.0k forecast; 229.0k previous)
- Canada Consumer Prices Index growth rate for March 2025: 0.3% m/m (0.8% m/m forecast; 1.1% m/m previous); 2.3% y/y (2.8% y/y forecast; 2.6% y/y previous); core CPI: 2.2% y/y (2.8% y/y forecast; 2.7% y/y previous); 0.1% m/m (0.7% m/m forecast; 0.7% m/m previous)
- Canada Manufacturing Sales Final for February 2025: 0.2% m/m Final (-0.2% m/m forecast; 1.7% m/m previous)
- U.S. Export Prices growth rate for March 2025: 2.4% y/y (2.5% y/y forecast; 2.1% y/y previous); 0.0% m/m (0.2% m/m forecast; 0.1% m/m previous)
- U.S. Import Prices growth rate for March 2025: -0.1% m/m (0.1% m/m forecast; 0.4% m/m previous); 0.9% y/y (2.4% y/y forecast; 2.0% y/y previous)
- U.S. Empire State Manufacturing Index for April 2025: -8.1 (-12.8 expected, -20.0 previous)
- Canadian Finance Ministry announced targeted exemptions from retaliatory tariffs for U.S. automobile producers and industry-specific manufacturers who satisfy particular requirements
- Trump posted that Nvidia committed $500B in supercomputers exclusively in the U.S. and that all permits are being expedited to firms shifting to domestic production
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Markets had a choppy run on Tuesday while traders braced for tariff updates and kept close tabs on exchanges between the U.S. and China. News that China halted orders of Boeing aircraft from the U.S. sparked a decline in WTI crude oil, along with the IEA’s downgrade of global oil demand forecasts for the year.
U.S. equity futures, on the other hand, managed to stay afloat on hopes that ongoing trade discussions could bear fruit soon. European markets closed marginally in the black, despite rumors that EU trade talks weren’t making much progress, as “no news is good news” appears to be keeping losses in check.
Meanwhile, safe-haven gold remained elevated thanks to persistent market uncertainty and slowing demand for U.S. assets, while bitcoin struggled to stay afloat while holding on to the $84,000 handle. Treasury yields chopped around throughout the day but remained largely in the red after going for a more prolonged drop after seeing mixed U.S. data.
Later in the day, Nvidia shares got a decent boost from Trump’s post, citing that the company is making a huge investment in supercomputers in the U.S. and that necessary permits will be expedited, including to other firms that plan on boosting domestic production. Still, U.S. equity indices closed in negative territory, weighed by dips in mega tech sector shares like Amazon, Meta, and Apple.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Major Currencies Chart by TradingView
Dollar pairs moved mostly in sync during the early trading sessions, although the Aussie and Kiwi appeared to draw additional support from a relatively optimistic RBA meeting minutes. As it turned out, the central bank decided against preemptive easing efforts despite global trade uncertainty, as policymakers noted elevated inflationary pressures.
However, news of China halting its Boeing orders forced these commodity currencies to return recent gains before resuming their rallies as European markets opened in a somewhat risk-on mood.
Sterling was also able to sustain slight gains versus the U.S. dollar, even though the U.K. jobs report turned out mixed, as the claimant count beat estimates while wage growth slowed. Weaker-than-expected ZEW economic sentiment readings from Germany and the entire euro region weighed on the shared currency starting from the London session, with EUR/USD eventually closing 0.56% in the red.
Downbeat inflation figures from Canada also contributed to the Loonie’s losses, along with the IEA’s downgraded oil demand forecasts, leading USD/CAD to close 0.55% higher. The franc was also on the back foot for the most part of the U.S. session, although there were no major reports out of the Swiss economy, while the Japanese yen fought to hold its ground and wound up with a 0.20% lead.
Upcoming Potential Catalysts on the Economic Calendar:
- U.K. Consumer Price Index at 6:00 am GMT
- U.K. Producer Price Index Input and Output at 6:00 am GMT
- U.K. Retail Price Index at 6:00 am GMT
- Euro area Current Account at 8:00 am GMT
- Euro area Current Account s.a for February 2025 at 8:00 am GMT
- Euro area Headline and Core CPI (Final) at 9:00 am GMT
- U.S. Headline and Core Retail Sales at 12:30 pm GMT
- U.S. Manufacturing Production at 1:15 pm GMT
- U.S. Industrial Production and Capacity Utilization Rate at 1:15 pm GMT
- Bank of Canada (BOC) Interest Rate Decision at 1:45 pm GMT
- BOC Monetary Policy Report at 1:45 pm GMT
- BOC Press Conference at 2:30 pm GMT
- U.S. EIA Crude Oil Inventories at 2:30 pm GMT
- Fed Chairperson Powell’s speech at 5:30 pm GMT
- New Zealand Quarterly CPI at 10:45 pm GMT
Today’s economic schedule is once again filled with major catalysts, including the U.K. CPI release, BOC monetary policy decision, and U.S. retail sales data.
Keep an eye out for signs of weakening U.K. price pressures or slowing U.S. consumer spending that could impact their respective central banks’ policy biases. Be sure to check out the BOC’s Quarterly Monetary Policy Report that contains their updated economic forecasts since this could shape expectations for future policy action, too.
After that, volatility could pick up around Fed head Powell’s testimony, as market players are keen to find out what he makes of the latest trade war drama and how it affects their economic outlook.
As always, stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!
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