Articles

Analysts at JP Morgan say that Trump’s social media activity has
significantly declined in market-moving influence compared to his
first term.

JPM cite his 126
posts on trade and economics, saying that only 10% of them triggered
notable currency fluctuations. JPM says this is in contrast to the 60
market-moving tweets per week during the 2018-2019 trade wars.

JPM add that while
Trump’s overall market impact has faded, his tariff-related tweets
remain potentially market-moving. For example, his announcement of 25%
tariffs on Mexico and Canada led to a 2% drop in the peso and a 1%
decline in the Canadian dollar in late January. The Chinese yuan
reacted to trade threats, falling after Trump’s Fentanyl-related
tariff comments but recovering following positive remarks about a
conversation with President Xi.

This article was written by Eamonn Sheridan at www.forexlive.com.

Trump said he may not let Venezuela export oil and petroleum products via companies like Chevron

• “We’re looking at that now”

Less oil (like cutting it off from Venezuela) would, at the margin, support then price. However, there are a couple of things to keep in mind on this.

1. If Trump threatens Venezualan exports like this the response from Maduro could well be an offer to gladly accept back illegal immigrants from the US. That might appeal to Trumpenough that he doesn’t meddle with Venezualan experts.

2. Alternatively, and unlucky for Venezuela, Trump may have other sources of oil lined up, perhaps more from Iran if he can reach agreement on nukes with them, for example.

Let me know your thoughts in the comments!

Venezuela President Maduro

This article was written by Eamonn Sheridan at www.forexlive.com.

Trump announcing an announcement to come.

I wonder if this was a pre-empt/insider trade – a ramp into the cash close:

More:

• auto tariffs might be around 25%
• parma tariffs likely 25% or higher
• EU has been very unfair to us
• Talks with Russia were very good
• US won’t have to put any troops in Ukraine
• If Europeans want peacekeeping troops in Ukraine then that’s fine

This article was written by Eamonn Sheridan at www.forexlive.com.

• NBC: Putin is not interested in a peace deal
• US February Empire Fed 5.7 vs -1.0 expected
• US NAHB housing market index for February 42 versus 47 estimate
• Canada CPI inflation YoY 1.9% vs 1.9% estimate. MoM 0.1% versus 0.1% estimate
• SF Fed Pres. Daly: US economy is in a good place
• Silver Lake is near a deal for Intel’s Altera – report
• Toyota is supporting LG battery plant with $1.5 billion order
• Canadian election polls take a big turn as Mark Carney surges
• ECB’s Cipollone: Policy rates remain primary instrument for adjusting the monetary policy

Markets:

• S&P 500 up 0.2% to close record high of 6129
• US 10-year yields up 7.6 bps to 4.55%
• WTI crude oil up $1.04 to $71.78
• Gold up $37 to $2934
• USD leads, NZD lags ahead of RBNZ decision

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

Six weeks ago it was a foregone conclusion that the Conservatives would win the 2025 election (it’s due in October or earlier) and Pierre Poilievre would become the next Prime Minister.

Then three big things happened:

1. Trudeau resigned
2. Mark Carney ran for leadership
3. Trump threatened Canadian sovereignty

Trudeau was way past his best-before date and widely disliked in Canada but this poll shows that presumptive Liberal leadership winner Mark Carney could get a fresh look. That shows that Canadians dislike Trudeau personally more than Liberal policies (though I’d argue they really dislike the immigration policy post-covid).

The other problem is that Poilevre wasn’t hard enough on Trump and took a soft line. That wasn’t what Canadians wanted to hear when they were blind-sided by Trump’s talk of annexation.

It’s all led to some real chaos and a Conservative Party that’s searching for a message. Poilevre polls very well with men and has been trying to soften his image with women but, unfortunately for him, Carney is almost a perfect foil as he scores well with women voters.

I still think that Conservatives win a majority as Trump’s attacks cool and Conservatives re-focus on domestic problems but it’s much more uncertain than I thought. If polls continue in this direction and Liberals win, I expect a negative reaction in the loonie. That said, Carney is still a decided shift to the right from Trudeau and isn’t someone that markets would be fearful of.

As for the timing of an election: Carney is riding high and he promised to call an election immediately if he wins the leadership race on March 9.

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

One thing that’s been floating around in my head in a comment that President Trump said two weeks ago when he signed the fresh ‘maximum pressure’ executive order to halt Iran oil exports.

“This is one that I’m torn about,” Trump told reporters in the Oval
Office. “Everybody wants me sign it. I’ll do that. It’s very tough on
Iran,” he said.

That struck me as strange, you can watch it here.

This order is similar to the one he signed in his first term that curb Iran’s oil exports and he was much more enthusiastic the first time.

This time Trump called it ‘historic’.

“Hopefully we’re not going to have to do that much,” he said.

He talked about making a deal but it had a clear objective.

“They can not have a nuclear weapon, with me it’s very simple. They just can’t have a nuclear weapon,” he said. “I think they’re close, they’re too close.”

Iran is probably more determined than ever to get one.

Trump is someone who has consistently been against war but he’s also very close with Netanyahu and Iran was considerably weakened in Palestine and Libya. Trump and Netanyahu could see this as an opportune time to strike and that’s something that would seriously upend the Middle East and spike oil prices. It could also explain Trump’s eagerness to make a deal in Ukraine because it would ease Russian oil flows.

WTI crude oil is up $1.06 to $71.77.

Meanwhile, the world of natural gas is much simpler. Today it’s simply that forecasts show a cold winter staying cold in the US and that led to a rise back above the $4 level.

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

There were several reports over the long weekend suggesting that Intel could be split up and sold off. That has fresh traction with a report from Bloomberg that Silver Lake is near a deal for a stake in Intel’s Altera.

Intel bought Altera in an all-cash deal in 2015 worth $16.7 billion. Currently, Intel’s market cap is $115 billion but that comes after a 40% rally in the past week on breakup speculation.

Silver Lake is a Silicon Valley private equity firm that has made landmark deals on Dell, Skype, Alibaba, Broadcom and NXP Semiconductors so it knows the space. None of this is a big surprise as reports in January said Silver Lake was in the running.

In any case, INTC is up 13% today and edged further higher after the latest report.

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

US equities are under some mild selling pressure at the moment as the S&P 500 erased a small gain and is now down 10 points to 6104. A test of the 6100 barrier held and this looks like moderate back-and-fill price action.

Zooming out, the daily chart shows consolidation just below the January record high.

In terms of the fundamentals, the market is generally waiting for whatever comes next from Trump and Congress. I fear there will be some real angst about passing the tax cut before it gets to the finish line.

On the fundamental side, the soft retail sales reading on Friday is a concern and likely to set off two weeks of soul searching around the strength of the economy.

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

BofA maintains a EUR/USD outlook of short-term weakness but a medium-term recovery. They do not expect parity, but the pair could drift lower before rallying to 1.10 by year-end—well above consensus. With EUR/USD already at their mid-year forecast of 1.05 ahead of schedule, their broader view remains intact: USD strength persists in Q1, but fades in H2 2025.

Key Points:

Near-Term EUR/USD Weakness

• The USD remains broadly supported through Q1.
• EUR/USD may face further pressure but should stop short of parity.

Gradual EUR/USD Recovery Later in 2025

• USD depreciation expected in H2 as global growth stabilizes.
• EUR/USD is forecast to rally towards 1.10 by year-end.
• This projection is above consensus expectations.

Forecast Timeline

• Mid-year target of 1.05 reached early—but view remains unchanged.
• Expecting further near-term EUR/USD weakness before a recovery later in 2025.

Conclusion:

BofA sees limited downside for EUR/USD in the near term before a stronger rebound in H2 2025. Parity is unlikely, and they expect a year-end rally to 1.10, suggesting EUR shorts may be exhausted later this year.

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

CNBC is reporting that Russia Pres. Putin is not interested in a peace deal:

• U.S.-Russia Talks: The Trump administration has started preliminary negotiations with Russia to end the Ukraine war, with discussions set to take place in Saudi Arabia.
• Putin’s Intentions: Western intelligence officials and U.S. congressional sources indicate there is no intelligence suggesting Putin wants a real peace deal; instead, he still aims to control all of Ukraine.
• Putin’s Strategy: Intelligence suggests Putin believes he is winning and can wait out Ukraine and Europe. Battlefield losses are not pressuring him to stop fighting.
• Trump’s View: After a call with Putin, Trump stated he believes Putin wants to end the war, contradicting intelligence reports. He also spoke with Ukrainian President Zelenskyy, who expressed a desire for peace.
• Negotiating Team: Trump has assembled a team for negotiations, including Secretary of State Marco Rubio, CIA Director John Ratcliffe, National Security Adviser Michael Waltz, and Middle East envoy Steve Witkoff.
• Fogel’s Release: The U.S. secured the release of American teacher Marc Fogel from Russia, with Witkoff traveling to Moscow to bring him back. During the trip, Witkoff met with Putin for three hours, though details of the meeting remain undisclosed.
• Next Steps: Rubio, Witkoff, and Waltz are set to meet the Russian delegation as part of the ongoing diplomatic efforts.

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

Trump has announced that reciprocal tariffs will be going into effect in April, and my guess is that it will lead to countries looking to gain favor or reduce trade deficits.

Toyota is supporting a US LG battery plant with a $1.5 billion order according to Bloomberg.

Trump has said that countries with trade tariffs, who apply VAT to US products or subsidize domestic industries will be charged a reciprocol tarriff on their goods.

Countries can avoid tariffs by reducing tariffs or producing good within the US border. Buying LG batteries within the US borders (instead of sourcing them from outside the US), may be a third way to gain favor.

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

European shares are closing higher on the day. The exception perhaps is the UK FTSE 100 which is down -0.1%. The German DAX is closing at a new record high.

The final numbers are showing:

• German DAX +59.04 points or 0.26% at 22863.24
• France’s CAC +17.43 points or 0.21% at 8206.57
• UK’s FTSE 100 -1.28 points or -0.01% at 8766.74
• Spain’s Ibex +127 points or 0.98% at 13143.91
• Italy’s FTSE MIB +226.43 points or 0.59% at 58554.14

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