FOREX NEWS & BLOG

Bessent: I could see a Trump-Xi call happening in the coming weeks, months

Bessent: I could see a Trump-Xi call happening in the coming weeks, months

May 12, 2025 2:13 pm |

  • Trump viewed 80% as not being an embargo for China
  • We can always go back to 2 April level i.e. 54% tariffs for China
  • Sees a phone call taking place before any meeting between Trump and Xi

The current timeline for the status quo is 90 days. So, better get on it. But as mentioned, the 90 days is pretty much just an initial timeline. Unless talks implode between both sides, that can always be readjusted to a longer timeline. The question is if the can continues to be kicked down the road for long enough, will Trump lose patience?

This article was written by Justin Low at www.forexlive.com.

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Bessent: It is implausible that tariffs on China go below 10%

Bessent: It is implausible that tariffs on China go below 10%

May 12, 2025 2:06 pm |

  • Current tariffs level is a floor
  • Now, we have a process in place to avoid further escalation

This at least clears things up a bit on their current position at least. As a reminder, the US is now putting a 10% base level tariffs plus 20% tariffs due to the fentanyl issue (30% total) on China. And the de minimis exemption will not be restored as well even with the climb down. Meanwhile, China is putting a 10% base level tariffs on the US and have not pulled back on restricting rare earth exports from before here.

This article was written by Justin Low at www.forexlive.com.

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ForexLive European FX news wrap: US, China strike deal to lower tariffs after talks

ForexLive European FX news wrap: US, China strike deal to lower tariffs after talks

May 12, 2025 2:05 pm |

Headlines:

Markets:

  • USD leads, JPY lags on the day
  • European equities higher; S&P 500 futures up 3%
  • US 10-year yields up 7.6 bps to 4.451%
  • Gold down 3.0% to $3,224
  • WTI crude up 4.0% to $63.50
  • Bitcoin down 0.5% to $103,794

The big news of the day and likely for this week already is that the US and China have come to an agreement to de-escalate trade tensions while seeking further talks in the weeks/months ahead.

The tariff levels for both sides are brought down by 115%. So, that means the US is still imposing 30% tariffs on China while China is imposing 10% tariffs on the US during this 90-day pause period.

That said, the agreement today will not cover the de minimis exemption that was abolished as of 2 May and China is also still keeping their restriction on rare earth exports in the meantime.

US Treasury secretary Bessent had a lot to say during the session, reaffirming that the new mechanism in place for discussions will facilitate much calmer discussions and actions between both sides. He made sure markets know that the mechanism “will avoid the type of escalation” from last month.

The dollar and risk trades rallied on the news unsurprisingly and held gains throughout. S&P 500 futures were already up 1.5% before doubling gains to be up 3% now. Nasdaq futures are up 3.8% and poised to reenter a bull market again.

As for the dollar, the gains were solid across the board. USD/JPY jumped up by a good 300 pips at the highs today, extending gains from around 146.20 to above 148.00 now on the day. Meanwhile, EUR/USD is down over 1% to 1.1100 and GBP/USD also down 1% to 1.3175 currently.

Besides that, USD/CAD is up slightly by 0.3% and nudging closer to 1.4000 while AUD/USD is down 0.4% to 0.6390 after some stubbornness following the initial headlines.

In other markets, bond yields are also racing higher on the optimism as markets pare back rate cut bets as well. Oil is a strong beneficiary as it climbs up by 4% to $63.50. And gold is one of the bigger casualties in all this, down over 3% to $3,224 on the day.

This article was written by Justin Low at www.forexlive.com.

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Dollar: Haste Makes Waste! Forecast as of 09.05.2025

Dollar: Haste Makes Waste! Forecast as of 09.05.2025

May 12, 2025 1:19 pm |

The U.S. administration presents the UK deal as a model — but in reality, it’s far from exemplary. Yet markets keep believing the White House’s narrative and buying the U.S. dollar. Let’s discuss it and make a trading plan for EUR/USD. Major Takeaways The U.S. and the UK struck a trade deal. Investors are betting on lower tariffs. The derivatives market is scaling back Fed rate cut expectations. A EUR/USD rebound from $1.117 will be a reason to shift from shorts to longs. Weekly Fundamental Forecast for Dollar The White House is overplaying its hand. It’s now clear that Washington’s… Read full author’s opinion and review in blog of #LiteFinance

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The USD moves higher after suspension of US/China tariffs. Stocks higher. USD higher.

The USD moves higher after suspension of US/China tariffs. Stocks higher. USD higher.

May 12, 2025 12:41 pm |

The United States and China have agreed to a 90-day suspension of their tariffs, with the U.S. reducing tariffs on Chinese goods from 145% to 30%, while China will cut duties on American imports from 125% to 10%.

Both sides committed to continuing negotiations, with U.S. Treasury Secretary Scott Bessent emphasizing a mutual interest in avoiding full economic decoupling. China will also suspend countermeasures, including export restrictions on rare earth materials.

Although the truce breaks a damaging impasse that halted many cross-border orders, the deal lacks concrete commitments from China on currency or trade imbalances, prompting skepticism about its long-term durability.

The question is will the suspension lead to more businesses scrambling to take advantage of the temporary tariff relief, pushing up transport costs and inflation in the process (30% is still a BIG jump in costs), or will the 30% still be a game changer (i.e., still too high).

Treas. Sec. Bessent is making the rounds and stated that the U.S. is aiming for a strategic decoupling from China in critical sectors such as steel, semiconductors, and select medicines to safeguard national interests. He noted that China now appears serious about stemming the flow of fentanyl into the U.S., and that both sides have established a mechanism to avoid further tariff escalation. Despite the decoupling goals, Bessent emphasized that the U.S. still wants American businesses to be able to sell into the Chinese market. He confirmed that significant progress was made during two days of talks and hinted that further meetings with Chinese counterparts are likely in the coming weeks, with future discussions expected to focus on non-tariff trade barriers.

Over the weekend, President Trump also announced plans to reinstate his “Most Favored Nation” policy aimed at reducing prescription drug costs by tying U.S. prices to those in the lowest-paying countries. The original rule, finalized in 2020, targeted Medicare payments for drugs administered in doctors’ offices but was blocked by courts and later revoked by President Biden. In a Truth Social post, Trump claimed the new executive order—set to be signed Monday—would cut drug prices by 30% to 80%, though specific details on which drugs or payments would be affected remain unclear.

US stocks are sharply higher on all the news, with the futures implying:

  • Dow Industrial average futures implying a gain of 1026 points. On Friday the index fell -119.11 or -0.29%
  • S&P index futures implying a gain of 172 109 points. On Friday the index fell -4.03 points or -0.07%.
  • Nasdaq futures implying a gain of 790 points. On Friday the index was unchanged

In the European markets:

  • German Dax, +0.53% (traded to a new record today)
  • France’s CAC, +1.37%
  • UK FTSE 100, +0.49%
  • Spain’s Ibex, +0.56% (highest level since 2008)
  • Italy’s FTSE MIB, +1.78% (highest level since 2007)

In the US debt market, yields are higher

  • 2-year yield 3.93%, +10.0 basis points
  • 5-year yield 4.090%, +10.3 basis points
  • 10-year yield 4.451%, +7.6 basis points
  • 30-year yield 4.81%, +4.9 basis points

In other markets:

  • Crude oil up $2.50 or 4.0% to $63.54
  • Silver is and $0.44 or -1.33% to $32.27
  • Gold is down $108 or -3.26% to $3217.79
  • Bitcoin is trading up $164 at $104,293. On Friday the price closed at $102,991.

This article was written by Greg Michalowski at www.forexlive.com.

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IG Group “Performed Strongly” in April as Trading Activity Jumped due to Volatility

IG Group “Performed Strongly” in April as Trading Activity Jumped due to Volatility

May 12, 2025 12:05 pm |

IG Group (LON: IGG) expects to close the ongoing fiscal year 2025 with revenue and adjusted profit that “meet or slightly exceed the upper end of the current range” of market expectations. The broker further highlighted that it has “performed strongly in Q4 FY25 as elevated volatility across a range of asset classes, particularly in April, has resulted in higher levels of client trading activity than expected in typical market conditions.”

According to consensus estimations, IG is expected to generate total revenue between £1.03 billion and £1.05 billion in FY25, while adjusted pre-tax profit is expected in the range of £489.1 million to £516.3 million.

The Winners of Market Volatility

Global stock markets experienced strong volatility since the beginning of April, as US President Donald Trump announced his plans to impose tariffs on almost all countries. Although the base tariff rate was set at 10 per cent, Trump subsequently increased the tariff on China to as high as 245 per cent.

Despite weeks of distress, the markets calmed after Trump suspended the date to impose tariffs and began negotiating trade deals with multiple countries.

Although IG Group’s stock dipped during the market-wide turbulence last month, it rebounded sharply and gained about 11 per cent in the past month. Over the past year, IGG stock has risen by approximately 40 per cent.

IG Maintaining Performance Stability

While demand for IG’s services clearly surged in April, the broker also performed well in the previous three quarters of the current financial year. In the first quarter of FY25, which spanned June to August 2024, IG generated £278.9 million in revenue, a 15 per cent year-over-year increase. In Q2 and Q3, the company brought in £243.6 million and £268.0 million, respectively.

IG also completed the acquisition of retail stock trading platform Freetrade on 1 April 2025, in a £160 million cash deal. “Freetrade has continued to trade well in Q4 FY25, with performance tracking in line with the Group’s expectations,” the latest announcement added.

Meanwhile, the London-headquartered broker is enhancing its liquidity position by refinancing its £400 million revolving credit facility, which is due to mature in October 2026, with a new £600 million facility expiring in May 2030. The company aims to increase the scale of its operations and support future growth objectives.

FinanceMagnates.com recently reported that Google lifted the ad restriction on the French entity of IG after seven years. This led to a doubling in monthly visibility and account openings at IG France.

This article was written by Arnab Shome at www.financemagnates.com.

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Traders Get Conversational Access to KCx Analytics via FlexTrade AI

Traders Get Conversational Access to KCx Analytics via FlexTrade AI

May 12, 2025 12:02 pm |

FlexTrade
Systems and Kepler Cheuvreux’s KCx execution services have launched a new
workflow that allows traders to access KCx’s analytical data through natural
language queries in FlexTrade’s AI assistant, FlxAI, the companies announced today
(Monday).

FlexTrade and KCx Launch
AI-Powered Analytics Integration for Traders

The
integration works by translating natural language requests into API commands
that retrieve data from KCx’s analytics suite and presenting results as
readable narratives within FlexTrade’s order blotter. The collaboration comes
as trading desks increasingly adopt conversational AI to accelerate
decision-making processes and extract market insights more efficiently.

The newest
update, being showcased at TradeTech Europe in Paris this week, enables users
of FlexTrade’s trading platforms to query KCx’s market analytics using
conversational commands rather than navigating complex interfaces or data sets.

“Users
can simply ask questions like ‘What’s the anticipated closing volume according
to KCx?’ and receive immediate, actionable insights,” said Andy Mahoney,
Managing Director for EMEA at FlexTrade. “This extends our coverage to third-party data that is relevant, useful,
and timely to users.”

In
February, the
company integrated LoopFX’s dark pool matching capabilities into its
trading platform, enabling to execute large forex trades with reduced market
impact.

Improving Decision Support

Chris
McConville, Global Head of Execution Services and Trading at KCx, emphasized
that the integration focuses on enhancing workflow efficiency rather than
solely developing AI-driven execution algorithms.

“Our
priority is to improve decision support, reduce manual processes, and simplify
interactions with complex data,” McConville said. “This enables
traders and portfolio managers to focus on more strategic, high-value
tasks.”

The
companies plan to further develop the integration to support agent-to-agent
communication, allowing FlxAI to communicate directly with KCx’s forthcoming AI
chat agent to deliver additional proprietary data and working order content.

Anvar
Karimson, Chief Technology Officer at Kepler Cheuvreux, described the
integration as “a significant technological advancement” that removes
barriers between complex analysis and trading decisions.

“Natural
language interaction elegantly removes barriers between complex analysis and
trading decisions,” Karimson said. “This reflects our core belief
that sophisticated technology should feel intuitive while enhancing how clients
interact with markets.”

The new
capability builds on KCx’s existing API Analytical Suite and is available to
mutual clients of both platforms.

This article was written by Damian Chmiel at www.financemagnates.com.

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