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Some Geopolitical news:

• Ukraine’s Zelenskyy expects US to ensure cease-fire is without conditions despite Russian claims.
• Sanctions against Russia should remain in place

Meanwhile France’s Macron says

• Russia reinterpreting what was agreed in cease-fire talks
• France to provide military support to Ukraine of EUR $2B

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

This week, we got another dose of the leaps that are imminent in AI but at the same time, the market signals are being lost.

Microsoft is cutting AI spending and that’s leading to a heavy selloff today in AI names with Nvidia down 6.3%. The driver of this is because AI is becoming cheaper and commoditized faster than anyone thought possible.

There is no moat and it will be hard for anyone to make money from AI.

The real story though will be people making money with AI. That’s where it hits the macro economy as jobs are replaced by AI and robotics.

In the last 24 hours alone:

• Google’s new Gemini 2.5 pro crushed prior benchmark highs
• DeepSeek V3 caught GPT 4o and is the best non-reasoning model
• DeepSeek is accelerating R2, which is based on this and should at least match the best reasoning models at a fraction of the price
• All this will be open source and very cheap from DeepSeek
• OpenAI released image generation integrated into 4o and it’s solved things like text and coherence (see above)

So while Trump is screwing around with tariffs for the next four years and trying to re-litigate the past 30 years of globalization, the world is going to be upended by technology. Whatever the macro impacts of tariffs are, they will be upended by the impacts of AI and robotics.

As Bill Gates said in February: Within 10 years, humans won’t be needed ‘for most things’.

That’s going to be the biggest shock to economies ever.

So while we are all drowning in tariff and political drama, I expect the real money in markets to be made in figuring out who is best using AI and who can exploit that.

This article was written by Adam Button at www.forexlive.com.

This report is more useful when it’s released before Canadian retail sales but RBC is out today with its latest data on Canadian cardholder spending.

Canada’s largest bank said card transactions fell 0.2% in February, which is largely consistent with the -0.4% decline in the advance retail sales report.

Sales were influenced by poor February weather and the HST holiday through Feb 15. Overall though, there is tremendous angst in Canada but few indications of changed consumer behaviour.

“Spending on discretionary goods declined in February, but spending on discretionary services and essentials were little changed from January. Sales at restaurants edged higher—broadly consistent with data from OpenTable showing restaurant bookings still running 20% above year-ago levels into late March”

They also note that Ontario has recently doled out $200 stimulus cheques to every person in the province and that province leads the annual rise in spending.

Overall, it’s all a puzzle with Canadian consumer confidence at generational lows but consumer spending just fine. It’s a similar dynamic in the US and elsewhere.

This article was written by Adam Button at www.forexlive.com.

The market is reluctant to fully embrace it but the picture around April 2 tariffs is improving.

Late yesterday, a report from the Toronto Star said Canada would be at the bottom end of tariffs. Mexico is presumably in the same boat, given it’s on the same trade agreement. In addition, Trump said this week there has been a lot of progress on fentanyl, which is another good sign.

Today, we got a CNBC report saying that VAT taxes and non-tariff barriers wouldn’t be taken into account on tariff rates, or at least not fully taken into account.

Given all this, you can make the argument that tariffs on Mexico and Canada should be near nil. Despite some of the misinformation on the internet, the effective tariff on US goods entering Canada is just 1.1%. Mexico isn’t much higher.

What I worry about is that by threatening 25%, Trump is softening up Canada and Mexico for something higher than that. My sense is that he wants a tariff at the highest level he can get away with (in part because he wants to count the revenue in a tax cut). Now that’s a calculation that’s wrought with pitfalls because any level could invite retaliation.

Does it mean Canada/Mexico would accept 5%? 10%? The Washington Post described Trump’s foreign policy doctrine as ‘escalate to de-escalate’ and that looks like the doctrine on trade as well.

And what about Europe? Tariff rates on US goods are higher but much of that is around autos and Europe has already said it could drop those tariffs. Maybe we start with a higher number and then negotiate in an inverse of what’s happened with Mexico/Canada?

I think that would ultimately be good news because much of the US trade or the corporate level is with Mexico/Canada. China meanwhile remains thorny because that’s the ultimate target and Trump has teed up some Venezuelan tariffs, which are probably a fresh excuse to tariff China. But surveys have China tariff expectations at 50%, which highlight a heavy dose of fear already priced in.

A final question is around agriculture, which is a thorny issue. The US (and virtually every country) massively subsidizes farmers and protects its local farms. Will the US take that into account or try to lump it all together?

Also see: What’s priced in for Trump tariffs

This article was written by Adam Button at www.forexlive.com.

The latest from the WSJ ahead of today’s tariffs:

The White House is also weighing plans to impose tariffs on finished vehicles coming into the U.S. but not automotive parts, according to Sen. Bernie Moreno (R., Ohio) and other people familiar with the discussions.

Moreno also revealed more of Trump’s tariff strategy:

Trump’s economic team is preparing its reciprocal tariff action by calculating tariff rates for trading partners based on barriers including taxes and regulations, the administration official said. But the administration might not implement the full value of the tariff rate for each country, the official said.

Moreno said that more measured reciprocal tariffs would help protect the economies of key trading partners and that tougher levies could be implemented later if other nations retaliate with duties of their own.

This sounds like a strategy to try to get away with higher rates and a dare for countries to retaliate.

This article was written by Adam Button at www.forexlive.com.

Press Secretary Karoline Leavitt, in today’s briefing confirmed that Trump will announce auto tariffs at 4 pm ET today.

Reports on what is coming are scarce. It’s not at all clear who these will target, when the will go into effect and if they will also be on auto parts.

The market has tilted on this with the S&P 500 down 1.2% and Nasdaq down 2.1%. Despite that, automotive stocks are taking it in stride with Ford down 1.6% and GM down 1.7%. That could be a sign those names will be protected from competition but I think it’s a sign the market isn’t that worried about North American tariffs.

My suspicion is that this is a short piece of theatre. European officials for awhile have been saying they would or could lower US auto tariffs. They may be preparing to do that before April 2 or in the near future. That would create an off-ramp to remove these tariffs and an opportunity for Trump to declare a victory.

If I’m wrong, there is going to be some real trouble but — in any case — it will take some time to sort through this mess. Here is an idea of who could me most-affected. Of them, I have the hardest time figuring out an off-ramp for South Korea but just this week, Hyundai announced a big plant investment.

This article was written by Adam Button at www.forexlive.com.

• High yield 4.910%
• WI level at the time of the auction 4.095%
• Tail +0.5 basis points versus six-month average of -0.1 basis points
• Bid to cover 2.33X versus six-month average of 2.40X
• Directs (domestic demand) 10.97% versus six-month average of 18.9%
• Indirects (international demand) 75.8% versus six-month average of 69.3%
• Dealers 13.2% versus six-month average of 11.9%

A little good, but more bad.

The good is the international demand was strong at 75.8%

The not so good is the there was a modest positive tail. The Bid to cover was less than the average. The domestic demand was not great at all (which may be a flow back into stocks):

Auction grade: C

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

The major European indices are closing mostly lower.

A snapshot of the closing levels shows:

• German DAX, -1.14%
• France’s CAC -0.96%
• UK’s FTSE 100 +0.30%
• Spain’s Ibex -0.39%
• Italy’s FTSE MIB -0.83%

As London/European traders and for the exit, the broader US stock indices are sharply lower led by the NASDAQ index with a decline of -1.71%

• Dow industrial average -51 points or -0.12% at 42537.25
• S&P index -50.83 points or -0.89% at 5725.53
• NASDAQ index minus 310.31.0 -1.70% at 17961.23

in the US debt market, yields are higher despite the declines in US stocks:

• 2-year yield 4.004%, +2.0 basis points
• 5-year yield 4.086%, +2 point basis points
• 10 year yield 4.342%, +3.4 basis points
• 30 year yield 4.687%, +3.2 basis points.

Looking at other markets:

• Crude oil is trading up $0.90 at $69.90.
• Gold is trading down $3.32 at $3016.22
• Silver is trading down four cents at $33.67.
• Bitcoin is trading down $780 $86,656

The price of copper reached a new all-time highs on concerns about tariffs. The price reached $5.37 before rotating back to the downside.. The current price is up 2.8 cents at $5.238.

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

The post Ex-Dividend 27/3/2025 first appeared on IC Markets | Official Blog.

It’s tough to get comfortable ahead of April 2 even as the Trump administration dials down tariff threats. There are many ways this can go wrong and after the leaks in the Atlantic, you get the sense this administration is making it up as they go.

The latest leg lower came after a Bloomberg report saying Trump was preparing auto tariffs, likely on Europe.

The Nasdaq is down 1.6% and the S&P 500 is down 0.8% and threatening to fall into the gap to open the week.

This article was written by Adam Button at www.forexlive.com.

• Prior was +1448K

• Gasoline -1446K vs -1830K expected
• Distillates -421K vs -1568K expected
• Refinery utilization +0.1% vs +0.5% expected

WTI crude oil was up 99-cents ahead of this report and just below $70/barrel.

This report is good news on the surface but I think yesterday’s EIA data raised expectations. It showed:

• Crude -4600K
• Gasoline -3300K
• Distillates -1300K

This article was written by Adam Button at www.forexlive.com.

It’s been a struggle for crude so far this year but WTI is showing some signs of life. WTI crude is up $0.97 today to $69.97 ahead of US EIA weekly oil inventory data at the bottom of the hour.

Private weekly crude oil inventory was released late yesterday and showed:

• Crude -4600K
• Gasoline -3300K
• Distillates -1300K

There is a bit of a headwind from risk sentiment though but crude is fighting it for now.

This article was written by Adam Button at www.forexlive.com.