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As a reminder, we’ll have market closures in Australia, New Zealand, Europe, as well as the UK in the coming two business days. It is that time of the year where the Easter Bunny is out to play for the weekend. In Europe, the Euronext, Xetra, and LSE are all closed as well as the TARGET services. So, that means extremely thin liquidity conditions during the upcoming sessions. It leaves only North America trading to observe normal market flows. To those celebrating, have a great break and enjoy the weekend!

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

• Need to roll out policy measures at critical timing, act early and swiftly
• Should deliver policies precisely, enhance communications with markets
• Should guide formation of clear, stable market expectations

His other remarks are pretty normal but the headline comment stands out a little. That appears to be a cryptic message perhaps on trade relations with a certain someone surely.

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

Let’s dive straight into the calls (h/t @ MNI Markets).

Deutsche Bank- 25 bps rate cut- “Even with the US tariff pause, the arguments now clearly favour a cut”- “The hit to growth from reciprocal tariffs, uncertainty and financial conditions likely exceeds what the ECB
was expecting”- “We expect the “meaningfully less restrictive” language to remain in April despite another rate cut. In
combination with the view that inflation is returning to target, this has an implicit dovish leaning”- ECB will keep the data-dependent, meeting-by-meeting approach to
determining the “appropriate stance”- “We think the risks of disinflation are being underestimated, and we hold our 1.5% terminal rate view”

Societe Generale- 25 bps rate cut but not ruling out a 50 bps move “to more clearly exit the restrictive stance”- “The downside risk to growth and inflation should dominate any worries over one-off increases
in the price level”- “The message after the April
meeting will be much more focused on the disinflationary forces, stemming from weaker global and US
growth, lower energy prices, a stronger EURUSD, and a higher risk of China redirecting excess capacity
into Europe”- “While we would argue that neutral is likely somewhat higher than the ECB’s 1.75-2.25% in normal
conditions, we think there is margin for the ECB to err on the downside under the current conditions”

UBS- 25 bps rate cut- “We do not think the ECB will cut rates by 50 bps, given the current uncertainty over the degree
of EU retaliation (which would likely be inflationary), the duration of US tariffs at current levels (i.e. the
success of future negotiations) and – more broadly – the broader impact on Eurozone growth and inflation”- “We expect the ECB to follow up with another 25 bps rate cut to 2.0% in June”- “Another 25bp rate cut to 1.75% in July is not our base case scenario right now”- “That said, we think the hurdle towards a July cut to 1.75% is not very high, particularly if US tariffs appear
more permanent and the EU retaliates only to a limited extent, generating little additional inflation pressure;
a strong EUR and higher bond yields would also prove disinflationary and help the ECB to cut”

Goldman Sachs- 25 bps rate cut- “ECB to acknowledge the growing downside risks to growth and note that the
trade tensions raise the uncertainty around the inflation outlook”- “We expect the ECB to
remove the “meaningfully less restrictive” phrase but keep the remaining policy language unchanged”- “During the press conference, we look for President Lagarde to signal more concern around growth due to
the trade tensions but remain non-committal on future policy steps”- A 25 bps rate cut in June is “highly probable” before another expected rate cut in July- “Our updated ECB scenario analysis includes a downside scenario where the policy rate falls to 0.75% (for
example, if the euro area enters a deeper downturn) and an upside scenario where the policy rate remains
at 2% (for example, if the US administration reverts to narrower tariffs)”- Sees a 50% probability of
baseline, 30% upside and 20% downside in the scenario analysis

Commerzbank- 25 bps rate cut- ECB will probably describe its
current monetary policy as “neutral”- “We now expect interest rates to be cut
not only in June but also in September” due to US tariffs- “ECB is likely to be cautious in its communication and leave all doors open”, no kind of forward guidance is expected- “We
assume that monetary policy will no longer be described as “becoming meaningfully less restrictive”, rather it is likely to have reached the “neutral range” according to policymakers”

This is a very neat summary of the consensus view going into the meeting later:

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

UnitedHealth pulls the heaviest weight in the Dow and so them slashing earnings outlook for the year while reporting an earnings miss in Q1 is weighing on the index. Dow futures have erased earlier gains to be down 0.8% now with UNH shares indicated down by over 16% in pre-market trading.

This is also weighing slightly on the broader market mood with S&P 500 futures seeing gains chipped away to 0.6%. Tech shares remain buoyed with Nasdaq futures up 1.0% at the moment. The drag on UnitedHealth is also weighing on other health insurers such as Elevance and CVS Health. The former is down by 8% while the latter is down nearly 9% respectively in pre-market trading.

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

• Powell is always too late and wrong.
• Fed should have lowered interest rates long ago.
• Powell’s termination cannot come fast enough.

Trump has been criticising Powell since his first term. Powell’s term expires in May 2026.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The rate decision is going to be rather straightforward, with the ECB set to cut key policy rates by 25 bps today. So, is there anything else to watch out for as the central bank delivers the same decision for a sixth consecutive time? Let’s take a look.

The thing that will be scrutinised heavily from the statement today will of course be this part. The ECB in March tweaked their language on restrictiveness in saying that “monetary policy is becoming meaningfully less restrictive”. The previous statement before that said “monetary
policy remains restrictive”.

So, are they about to change that up again in April amid the mixture of risks from US tariffs?

That’s the key thing to look out for in the statement, in seeing if the ECB has the appetite to switch so hastily to a more neutral stance.

But even so, don’t expect that to change the bigger picture outlook for the central bank though. Amid downside risks to the economy, they are still expected to deliver more rate cuts down the road. The question though is by how much more?

The issue here is that all of this hinges on how Trump’s tariffs are going to play out in the weeks/months ahead. And even if not directly regarding trade with the EU, even US-China relations will have a spillover impact. So, that needs to be considered as well.

In that lieu, the main takeaway is that the ECB will surely continue their meeting-by-meeting approach. And that’s basically the more important thing right now.

As such, even with the removal of the phrase “monetary policy is becoming meaningfully less restrictive” it doesn’t mean a material change to the ECB’s next steps. They still have to take things one meeting at a time considering what’s at stake.

In essence, the ECB will not offer much of any forward guidance and stick to a more flexible i.e. data-dependent and meeting-by-meeting approach.

Besides that, the only other thing today will be to watch out for Lagarde’s press conference. I wouldn’t expect too much though as I would wager that Lagarde is going to place a lot of emphasis on this one word: uncertainty. She will likely stress a great deal on that and avoid committing to anything.

No doubt she will be questioned as well on any removal of the above phrase as she said before this that:

“It’s not just, you know, an innocuous little change, it’s a change that has a certain meaning. We are now moving by having our monetary policy is
becoming meaningfully less restrictive to a more evolutionary approach.”

So, to move on from that so quickly will definitely invite some jabs from the press. But at this stage, she can easily dodge that by pointing to Trump’s tariffs and the uncertain nature of its impact on the euro area economy and inflation.

There’s a slight chance that markets could take all of this to mean a more hawkish stance. But if Lagarde plays her cards right, markets will be left waiting on trade developments in the aftermath – the same as before.

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

• Putin had a long conversation with Trump’s envoy Witkoff about Ukraine.
• Now the United States is continuing with Europeans and Ukrainians.
• Unfortunately, so far we only see the Europeans focusing on a continuation of the war.

More from the Russian Foreign Ministry:

• Ukraine continues to break on a daily basis the moratorium on energy strikes.
• Ukraine has struck Russian energy infrastructure more than 80 times since agreeing to the moratorium.
• We have passed this data on Ukrainian energy strikes to the Americans.

Today there is a meeting in Paris during which the US Secretary of State Rubio and special envoy Witkoff will meet President Macron and other European officials to negotiate a peace deal. Ukrainian officials and President Zelensky will also be present.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

Rate cuts by year-end

• Fed: 86 bps (84% probability of no change at the upcoming meeting)
• ECB: 79 bps (99% probability of rate cut at today’s decision)
• BoE: 79 bps (87% probability of rate cut at the upcoming meeting)
• BoC: 45 bps (52% probability of no change at the upcoming meeting)
• RBA: 118 bps (78% probability of 25 bps rate cut at the upcoming meeting)
• RBNZ: 78 bps (99% probability of rate cut at the upcoming meeting)
• SNB: 24 bps (74% probability of rate cut at the upcoming meeting)

* for the RBA, the rest of the probability is for a 50 bps cut.

Rate hikes by year-end

• BoJ: 14 bps (99% probability of no change at the upcoming meeting)

Since yesterday’s update we got some slight changes in the pricing. There is a less dovish pricing for the RBA following the solid Australian employment report today (although it remains pretty aggressive compared to just three weeks ago). Some positive comments from BoJ officials regarding the need of rate hikes have also impacted the expectations with a slightly more hawkish pricing.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The markets move the most on surprises or fresh news because they price or reprice future expectations. On a daily basis, probably 99% of the news that gets published is actually useless for the market because it doesn’t change anything or it’s not what the market is focused on.

As an example, yesterday we got Fed Chair Powell speaking and (surprisingly) he triggered a selloff in the stock market even though he didn’t say anything new. He basically repeated what he said two weeks ago. The move was probably driven by algos or some delusional traders hoping for a pivot.

When this happens, the moves are generally faded soon after as you can see in the Nasdaq chart above. This was not fresh news. The fresh news was two weeks ago when the stock market was selling off hard and there were hopes for Powell to provide some kind of support. Support that didn’t come and the stock market resumed the selloff.

You’ve probably noticed the same with the economic data in these last couple of weeks. The market hasn’t been caring about it because it’s old news. It reflects conditions before April 2 and April 9, and because it doesn’t change Trump’s or Fed’s policy. A big spike above cycle highs in the Jobless Claims data for example, would be fresh news because the market would start to build expectations on potential reaction from the Fed.

For a trader, being able to distinguish what is tradable information and what’s not is very important because it prevents overtrading and encourages capital preservation. Remember that making money in the markets is easy, but being able to keep it and grow it is where the real skill stands.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

After the strong risk rally triggered by Trump’s pause in reciprocal tariffs, most markets just went into consolidation awaiting new information. Bitcoin is one of those markets.

The focus switched towards trade negotiations and we are waiting for the first trade deals to start building expectations. We could just range until then.

There are some positive signs with China saying that they are open for talks but there’ve been also some disappointing news on the trade negotiations front as nothing has come out yet as it’s been all nice words but zero facts.

On the daily chart, we can see that bitcoin got stuck in a consolidation right at the key trendline. This is where we are having a battle between buyers and sellers. A strong rejection should open the door for a move back into the lows, while a successful breakout will likely take us to the 90,625 level quickly.

On the 1 hour chart, we can see more clearly the rangebound price action between the 83,000 support and the 86,125 resistance. The market participants will likely continue to play the range until we get a breakout on either side.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• Deeply concerned about US tariffs affecting Japan, world economy
• Impact could be felt via various routes such as trade and financial markets
• There’s a risk of exerting downwards pressure on Japan’s economy
• No comment on what will be discussed on FX at possible meeting with Bessent
• No change to Japan’s stance over recent FX market developments
• Actively exchanging views with the US on basic stance on FX
• Will closely communicate with the US on currency issues in light of market volatility

The remarks here came from an interview hours after the tariff talks began in Washington, so there were no probing questions on that. The big one mostly centered around FX, in asking Kato about market speculation that the US could ask Japan to join in on a coordinated effort to weaken the dollar. Of course, he brushed that aside as Japan will continue to want to avoid any topic on currency manipulation.

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

It’s been a good day for crude oil yesterday as the market benefited from a couple of positive headlines. The first one came in the European session when we got the Bloomberg report saying that China was open for talks with US. That triggered a quick rally as markets look forward to de-escalation on trade front to price out growth fears.

Then we got fresh US sanctions targeting Iran oil tankers in the American session, which provided further support to prices although the bulk of the move was caused by the Chinese headline in the morning. This just shows how laser focused the market is on anything regarding trade negotiations.

On the 1 hour chart, we can see that the price is now back at testing the key resistance zone around the 62.00-64.00 area. The sellers will likely continue to step in here with a defined risk above the resistance to keep targeting new lows, while the buyers will look for a break higher to invalidate the bearish setup and position for a rally into the 72.00 level next.

For now, we are just ranging between the 59.00 support and the 63.00 resistance. A breakout on either side should see the momentum increasing.

This article was written by Giuseppe Dellamotta at www.forexlive.com.