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This according to Kyodo News. This will definitely be an interesting one to watch out for when it happens. But unless Trump is also involved in the meeting, I reckon it might not lead to much. The meeting is expected to take place in Washington.

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

The kiwi has been quietly an outperformer in the past week, even against the likes of the euro and yen. In the case of NZD/USD, the dollar’s struggles is only compounding the upside move over the last few days. And that is leading to potentially a key technical break as seen above.

The pair had been somewhat consolidating to start the year, before testing the February low in a dip earlier this month. That came amid the initial fears from Trump’s reciprocal tariffs before a strong bounce from last week that is extending to today.

The jump above 0.5900 now sees buyers looking to come up for air in a push above its 200-day moving average (blue line).

The 29 November high from last year at 0.5928 might offer some minor resistance but the pair looks to be angling towards a push to 0.6000 next.

I’m sympathetic to the reasoning that the kiwi is more bid due to flows in AUD/NZD. The pair has seen a decline from 1.0900 to test 1.0700 in the past few days. One key reason for that is perhaps traders stepping up steeper rate cut bets by the RBA.

While the RBNZ is still on an easing path, market bets for the RBA have shot up dramatically since the start of the tariffs war. Traders have fully priced in a rate cut for the next meeting with odds of a 50 bps move even seen at ~20% now. For the year itself, they are pricing in ~121 bps of rate cuts. For some context, it was ~72 bps after the 1 April policy meeting.

But at the same time, the aussie has also been a decent performer – especially in the past two sessions. However, the kiwi still holds an edge in terms of overall gains.

Going back to NZD/USD, this is one chart to watch out for on the week. But again, headline risks can still spoil the party at any time. So, just be wary of that.

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

This will at least be one spot to feed into a calmer mood in broader markets for now. Long-end Treasuries are seeing some bids again, with yields backing away from the highs seen last week. 30-year yields are now down to 4.77%, falling a little further away from the 5% mark. Meanwhile, 10-year yields are seen at 4.34% today – down from a high of 4.59% on Friday last week.

As things stand, there’s still a lot to digest with Trump’s tariffs policy.

While we’ve gone through the initial reaction, it’s now over to analysing the impact of it all. At the same time, market players will also have to deal with the constant changes in the level of tariffs while also accounting for any possible retaliation and escalation.

Taking that into consideration, it’s hard to be too confident of a return to normality any time soon. That especially when US and China are still not seen making too much progress in striking an accord.

Xi is busy with his Southeast Asia tour this week and Trump is also not wanting to make the first move yet. So, there will definitely be economic pain to deal with during the interim.

As for Treasuries, it’s not just the relative uncertainty of the tariffs policy. The impact on the US deficit, inflation, economy, and Fed reaction function all also needs to be factored into the equation. And that’s the tough part at the moment, with investors already struggling for confidence amid the policy incoherence to begin with.

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

• Ex BOJ official says Bank to hold, not hike: “will be in a wait-and-see mode for a while”
• Goldman Sachs are wary of 500K of US job losses due to tariffs
• UBS has cut its China GDP growth forecast to 3.4% for 2025
• Survey of firms shows efforts to revive U.S. manufacturing through tariffs may backfire
• RBA minutes: May meeting an opportune time to consider reacting to potential risks
• PBOC sets USD/ CNY central rate at 7.2096 (vs. estimate at 7.3094)
• Senior BOJ official cites Trump tariffs as a cause of volatile market moves
• Chinese police put 3 U.S. operatives on wanted list over cyberattacks
• Bank of Korea seen holding rates this week, but cuts expected soon
• Morgan Stanley and Citigroup Inc. slashed their estimates for 2025 earnings
• Investing Education: Recession, and What to Watch
• Fed’s Bostic – inflation still much higher than target
• Japan finance minister Kato says negative impacts of excessive FX volatility
• ICYMI – Deutsche Bank expects the Fed to cut interest rates by 25 basis points in December
• UK consumer spending resilient in March despite tariff fears and rising business concerns
• New Zealand March food prices +0.5% m/m (prior -0.5%)
• Recap – Bessent said will begin interviewing for Fed Chair in fall
• RBNZ Conway: Hopefully what Trump put out on tariffs before pause is worst case scenario
• Fed’s Harker speech – no remarks on his economic or monetary policy outlook
• ICYMI – OPEC slashed its global oil demand growth forecast, citing tariffs
• RBNZ chief economist Conway says balance of risks has shifted to the downside
• ICYMI – Goldman CEO Solomon says prospect of a US recession ‘has increased’
• Forexlive Americas FX news wrap 14 Apr: Markets quiet after last weeks fireworks
• US Treas Sec Bessent speaking – some truth in his comments, some lies
• The US has begun its investigation ahead of pharmaceutical tariffs
• Trade ideas thread – Tuesday, 15 April, insightful charts, technical analysis, ideas

Asian markets traded cautiously on Tuesday as investors weighed fresh signs of stress from global trade tensions and growing expectations of policy easing in Australia.

Comments from Federal Reserve Bank of Atlanta President Raphael Bostic added to the uncertainty. While Bostic noted the U.S. economy is in a “pause” and flagged investment hesitancy, he also reiterated that inflation remains elevated and the labour market is still tight—casting doubt on the near-term case for Fed rate cuts.

Earlier, U.S. Treasury Secretary Scott Bessent downplayed concerns over foreign dumping of U.S. bonds but said Washington has tools ready, including potential buybacks of off-the-run securities, to help stabilise markets if needed. His remarks came amid broader concerns about debt market volatility and the legacy of prior issuance strategies (Bessent lambasted Yellen for using similar tools!).

In China, authorities in Harbin publicly accused U.S. intelligence agents of cyberattacks targeting infrastructure linked to the Asian Winter Games in February. Beijing alleged the NSA conducted a wide range of intrusions across sectors including energy and telecommunications, further straining already tense U.S.-China relations. No love lost between China and the US right now, is there?

On the policy front, minutes from the Reserve Bank of Australia’s April meeting revealed a shift toward likely further easing, setting the stage for a rate cut at the May gathering. Policymakers highlighted growing global risks—particularly from U.S. tariffs—and emphasised the importance of not undermining progress on inflation by acting too soon.

Major FX traded mixed in not large ranges. EUR/USD lost ground but as I update its little net changed. USD/JPY ticked a little higher but also retraced much of its move. AUD, NZD and GBP all added a few tics.

Gold rose.

EUR/USD update:

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

Goldman Sachs sought out academic studies on how tariffs impact:

• The broader statistical evidence points to negative net employment effects.
• While the range of estimates is wide, academic studies generally find that a 1Opp increase in tariff rates raises employment in protected industries by 0.2-0.4% but that each 1pp increase in tariff-driven costs lowers employment by 0.3-0.6%.
• Scaling these estimates to the US economy imply a boost of just under 100k to manufacturing employment from tariff protection but a roughly 500k drag on downstream employment from input cost pressures.

Bolding is mine. Manufacturing jobs added, around +100K, but the wider impact is negative, 500K of job losses.

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

UBS has cut its China GDP growth forecast to 3.4% for 2025

• Downgraded on assuming current tariff hikes will remain and China rolls out additional stimulus

UBS say the forecast comes with high margins of error

more to come

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

Trump tariffs unlikely to bring manufacturing back to U.S., CNBC survey shows.

Efforts to revive U.S. manufacturing through tariffs may backfire, with most companies saying the high cost of reshoring would keep production overseas, according to a new CNBC Supply Chain survey.

Nearly half of the firms surveyed said bringing manufacturing back to the U.S. would double their costs. As a result, instead of reshoring, companies are more likely to seek out new low-tariff regions to base operations, potentially shifting global supply chains rather than reversing them.

Among companies that would consider moving production to the U.S., 81% said they would rely primarily on automation rather than hiring local workers—undermining hopes of a large-scale industrial jobs revival.

The broader economic outlook painted by the survey is cautious. A majority of respondents (61%) expect consumer prices to rise and demand to soften in the near term. Meanwhile, 63% said a recession is now their base case scenario as tariff uncertainty weighs on confidence.

The findings highlight the growing disconnect between political pressure to reshore manufacturing and the financial realities businesses face in a globalised economy.

Link here to the CNBC piece for more.

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

Police in Harbin, northeastern China, announced on Tuesday that they are seeking three U.S. National Security Agency operatives suspected of conducting cyberattacks on the city during February’s Asian Winter Games.

According to the Harbin public security bureau, the individuals were linked to the NSA’s Office of Tailored Access Operations, which allegedly targeted critical IT infrastructure for the event, including systems handling registration, travel logistics, and competition entries.

Chinese investigators said the attacks aimed to access sensitive personal data and were disguised through front companies that procured global IP addresses and rented overseas servers to mask the source.

Authorities say the investigation is ongoing.

Info comes via Xinhua, link for more.

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Indicative of the ongoing deterioration in IUS-China relations

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

Via Bloomberg:

• Morgan Stanley and Citigroup Inc. slashed their estimates for 2025 earnings
• joining a wave of Wall Street banks warning that tariffs will curb profit growth

Citi’s lowered 2025 prediction for the S&P 500 to 5,800 from 6,500

• predicated on earnings of $255 a share for companies in the index, down from a previous $270 projection

Morgan Stanley cut 2025 earnings-per-share forecast to $257 from $271.

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

Japan finance minister Kato

• Planning to attend spring meetings of IMF, World Bank in Washington

• Forex rates should be determined by markets

• Excessive volatility would negatively affect economic and financial stability
• Have agreed with Bessent to closely communicate on forex
• Closely monitoring financial markets as they have been unstable recently

Kato gets a bit of extra bang for buck from his comments if he manages to conjure up some sort of cooperation with Bessent.

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

British consumer spending showed modest growth in March. There do seem to be signs of strain beginning to emerge beneath the surface.

British Retail Consortium (BRC) data:

• total retail sales rose 1.1% year-on-year in March, matching February’s pace
• like-for-like sales also held steady at 0.9%

BRC chief executive Helen Dickinson highlighted the resilience of both food and non-food categories, suggesting a quiet strengthening in consumer appetite despite geopolitical pressures.

In contrast, Barclays’ broader measure of UK consumer spending — which includes debit and credit card transactions — painted a more subdued picture:

• spending rose just 0.5% year-on-year, down from 1.0% in February and falling short of inflation
• supermarket sales dropped 2.6%, although warmer weather did support spending at garden centres and specialty food retailers

Barclays chief UK economist Jack Meaning warned of a possible softening in consumer activity ahead.

• “We expect spending to remain muted through mid-2025, before gradually recovering into 2026 as interest rate cuts and stabilising conditions take hold”

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

The New Zealand Food Price Index (FPI) is a measure of the changes in the average price of food items sold in New Zealand.

For the y/y, +3.5%

• prior +2.4%

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The New Zealand Food Price Index (FPI) is a measure of the changes in the average price of food items sold in New Zealand.

• calculated and published monthly by Statistics New Zealand
• the FPI tracks the prices of a basket of food items that represent the typical spending patterns of New Zealand households
• the FPI is an important indicator of inflation in New Zealand, as food prices account for a significant portion of household expenditure

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