Markets Drop on More Tariff News – Dow Down 1.5%

U.S. stock markets experienced a volatile day yesterday as tariff and counter-tariff updates hit the market. The three major indices finished in the red but pared back earlier, steeper losses. The Dow closed down 1.55%, the S&P 500 fell 1.22%, and the Nasdaq dropped a relatively modest 0.35%.

The dollar took a substantial hit, with the DXY losing 0.92% on the day, while Treasury yields pushed higher after recent losses. The 2-year yield rose 3.2 basis points to 3.982%, and the 10-year yield climbed 8.7 basis points to 4.242%.

Oil prices dropped again, with Brent hitting a six-month low—down 0.85% to $71.01—while WTI declined 0.73% to $67.86 per barrel. Gold pushed higher as the dollar weakened, gaining 0.83% on the day to close the NY session at $2,916.80.

FX Back in Focus as Markets Move Hard

The dollar suffered a significant decline in trading yesterday, with the DXY down 0.92%, mainly due to a resurgent euro, which surged nearly 1.25% after Germany announced a new €500 billion infrastructure fund.

Those viewing the dollar from a binary perspective would have seen the DXY drop nearly 2% over the last two days. However, in the current market environment, opportunities are likely emerging beyond the straightforward dollar plays that typically drive movements.

Geopolitical developments have played a major role in the sharp market moves seen overnight and in recent months. As a result, traders are finding strong opportunities in individual currencies and cross pairs more frequently than usual. Many experienced traders anticipate continued market volatility in the short term and are focusing on specific currencies—particularly the EUR, CAD, MXN, and CNY. However, traders should remain flexible, ready to pivot as market trends and news dictate.

Another Big Day Ahead for Markets Today

Financial markets are gearing up for a significant day, with a packed schedule of macroeconomic events and the potential for more geopolitical developments to impact the news cycle.

The Asian session has plenty of early action, with Australian GDP data being released alongside a scheduled speech by the Bank of Japan’s Kazuo Ueda. However, both events are likely to be overshadowed later in the session when President Trump addresses Congress.

Additionally, statements from China’s National People’s Congress (NPC) on global issues could trigger further market moves.

In the London session, early attention will be on Switzerland’s CPI data, followed by the Bank of England’s Monetary Policy Report Hearings, which will be closely watched by UK markets.

The New York session brings the first set of U.S. jobs data for the week, with the ADP Non-Farm Employment Change figures due (expected: +141K). Later, the market will focus on the Final Services PMI (expected: 49.7) and the ISM Services PMI (expected: 52.5).

The post General Market Analysis – 05/03/25 first appeared on IC Markets | Official Blog.

The Aussie has seen a strong rally over the last couple of trading sessions as geopolitical factors have dominated flows across FX and led to a sharp sell-off in the greenback. However, traders’ focus will turn back to fundamentals today, with the Australian Bureau of Statistics set to release the latest GDP data. Market expectations are for the data to show a 0.6% increase in the quarter-on-quarter figure, which would represent a significant improvement from last quarter’s 0.3% increase and lend some credence to the Reserve Bank’s hawkish rhetoric following last month’s rate cut.

Any significant deviation from the expected 0.6% print should lead to notable moves in the Aussie, both against the dollar and on the crosses, where it has experienced strong depreciation in recent days. Against the dollar, it has rallied well off levels just under 62 cents but is likely to face resistance near the 63-cent level, where both hourly trendline resistance and the 200-day moving average converge. A weaker print could ease some pressure on the RBA to maintain high rates, potentially causing the Aussie to retreat back into its range, with trendline support at 0.6190 as the initial target.

Resistance Levels:

• Resistance 2: 0.6308 – Trendline Resistance
• Resistance 1: 0.6292 – 200-Day Moving Average

Support Levels:

• Support 1: 0.6185 – Trendline Support and March Low
• Support 2: 0.6095 – Long-term Trendline Support

The post Trade the AUD/USD on the Australian GDP Data first appeared on IC Markets | Official Blog.

The post Ex-Dividend 5/3/2025 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei down 1.47%, Shanghai Composite up 0.13%, Hang Seng down 0.21% ASX down 0.58%
• Commodities : Gold at $2899.35 (-0.19%), Silver at $31.25 (0.18%), Brent Oil at $71.37 (-0.85%), WTI Oil at $67.88 (-0.48%)
• Rates : US 10-year yield at 4.153, UK 10-year yield at 4.5595, Germany 10-year yield at 2.4910

News & Data:

• (USD) ISM Manufacturing PMI 50.3  to 50.6 expected
• (USD) ISM Manufacturing Prices 62.4  to 56.2 expected

Markets Update:

Japanese stocks led declines in Asia-Pacific markets, falling nearly 2% after U.S. President Donald Trump confirmed that tariffs on Mexico and Canada would proceed as planned. The Nikkei 225 dropped 1.71%, while the Topix index lost 1.03%. Japan’s employment rate for January stood at 2.5%, slightly above the estimated 2.4%.

In South Korea, the Kospi index remained flat in choppy trade, while the Kosdaq fell 0.92%. The country’s retail sales declined 0.6% in January after a revised 0.2% increase in December. Hong Kong’s Hang Seng index dipped 0.18%, while China’s CSI 300 fell 0.17% ahead of the country’s “Two Sessions” parliamentary meeting.

Australia’s S&P/ASX 200 closed 0.58% lower at 8,198.10. The country’s retail sales grew 0.3% in January, aligning with forecasts, after a 0.1% decline in December. Meanwhile, India’s Nifty 50 dropped 0.25%, and the BSE Sensex lost 0.21%, reflecting broader market weakness in the region.

In the U.S., all three major indexes fell as Trump reaffirmed that 25% tariffs on Mexican and Canadian imports would take effect Tuesday. The S&P 500 dropped 1.76% to 5,849.72, marking its worst day since December. The Dow Jones Industrial Average declined 649.67 points (1.48%) to 43,191.24, while the Nasdaq Composite slid 2.64% to 18,350.19, weighed down by an 8% decline in Nvidia stock.

Upcoming Events: 

• 10:00 AM GMT – EUR Unemployment Rate

The post Tuesday 4th March 2025: Asian Markets Tumble as U.S. Confirms Tariffs on Mexico and Canada first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 4 March 2025

What happened in the Asia session?

After unexpectedly falling in December to mark the first decline in nine months, consumer spending rebounded in January as sales increased 0.3% MoM. The upturn was supported by an increase in categories such as cafes, restaurants and takeaway food services; food retailing; and clothing, footwear and personal accessory retailing. However, the RBA minutes were also released at the same time which indicated a shift in focus toward easing monetary conditions by this central bank, putting downward pressure on the Aussie – this currency pair fell under 0.6200 by midday in Asia.

What does it mean for the Europe & US sessions?

Bank of Japan (BoJ) Governor Kazuo Ueda will deliver his opening remarks at an event hosted by the International Monetary Fund in Tokyo where he could provide further insights into the outlook for future monetary policy action. With the second central bank meeting of this year coming up in a couple of weeks, Governor Ueda could indicate how hawkish their stance currently sits given the recent increase in price pressures based on the various metrics on consumer inflation. The yen continued to see strong inflows as a result of global uncertainties arising from the implementation of trade tariffs.

The Dollar Index (DXY)

Key news events today

FOMC Member Williams’ Speech (7:20 pm GMT)

What can we expect from DXY today?

Federal Reserve Bank of New York President John Williams is due to speak at the Bloomberg Invest Forum in New York where audience questions are expected. Given the current backdrop of global trade tariffs being imposed on the major trading partners of the United States, NY Fed President Williams could shed some light on how these events may impact the Fed’s decision-making process ahead of the FOMC meeting that is lined up in a couple of weeks.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 29 January.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilized at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• December’s Summary of Economic Projections (SEP) now indicates just two rate cuts in 2025 totalling 50 bps, compared to the full percentage point of reductions projected in the previous quarter.
• GDP growth forecasts were revised upward for 2024 (2.5% vs. 2% in the September projection) and 2025 (2.1% vs. 2%), while remaining steady at 2% for 2026. Similarly, PCE inflation projections have been adjusted higher for 2024 (2.4% vs. 2.3%), 2025 (2.5% vs. 2.1%), and 2026 (2.1% vs. 2%).
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• The Committee will roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing in each calendar month that exceeds a cap of $25 billion per month and redeem Treasury coupon securities up to this monthly cap and Treasury bills to the extent that coupon principal payments are less than the monthly cap.
• In addition, the Committee will reinvest the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency mortgage-backed securities (MBS) received in each calendar month that exceeds a cap of $35 billion per month into Treasury securities to roughly match the maturity composition of Treasury securities outstanding.
• The next meeting runs from 18 to 19 March 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

FOMC Member Williams’ Speech (7:20 pm GMT)

What can we expect from Gold today?

Federal Reserve Bank of New York President John Williams is due to speak at the Bloomberg Invest Forum in New York where audience questions are expected. Given the current backdrop of global trade tariffs being imposed on the major trading partners of the United States, NY Fed President Williams could shed some light on how these events may impact the Fed’s decision-making process ahead of the FOMC meeting that is lined up in a couple of weeks. Spot prices for gold stabilized around $2,860/oz on Monday before climbing higher towards $2,890/oz.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

RBA Monetary Policy Meeting Minutes (12:30 am GMT)

Retail Sale (12:30 am GMT)

What can we expect from AUD today?

After unexpectedly falling in December to mark the first decline in nine months, consumer spending rebounded in January as sales increased 0.3% MoM. The upturn was supported by an increase in categories such as cafes, restaurants and takeaway food services; food retailing; and clothing, footwear and personal accessory retailing. However, the RBA minutes were also released at the same time which indicated a shift in focus toward easing monetary conditions by this central bank, putting downward pressure on the Aussie – this currency pair fell under 0.6200 by midday in Asia.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 January, marking the first rate cut since November 2020.
• Financial conditions are restrictive, which is weighing on demand and is helping to bring down underlying inflation; growth in private demand has been subdued.
• Underlying inflation has moderated over the past three quarters with trimmed mean inflation easing to 3.2% over 2024 and it is expected to reach the 2–3% target range in early 2025, which is sooner than expected at the time of the November Statement.
• The unemployment rate declined a little in late 2024 to 4% with much of the strength in the labour market underpinned by strong employment growth, which has also bolstered household incomes.
• The announcement of tariffs between the United States and other major economies poses challenges to the global outlook but the scale and incidence of the tariffs and their effects remain highly uncertain – which may itself delay some investment until the outlook becomes clearer.
• Economic activity strengthened in China but growth there is still facing structural headwinds while domestic economic growth is forecast to pick up and the labour market is forecast to remain tight.
• If the cash rate follows the market path, underlying inflation is projected to be a little above 2.5% over most of the forecast period. The anticipated recovery of GDP growth and lingering tightness in labour market conditions are expected to sustain some upward pressure on inflation.
• Sustainably returning inflation to target within a reasonable timeframe remains the Board’s highest priority. This is consistent with the RBA’s mandate for price stability and full employment.
• The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions, paying close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
• The next meeting is on 1 April 2025.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi will likely take its cue from its Pacific neighbour and it could be dragged down by the Aussie as the RBA indicated a shift in focus toward easing monetary conditions in its meeting minutes released on early Tuesday. The Kiwi was floating above 0.5600 at the beginning of the Asia session.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 50 basis points bringing it down to 3.75% on 19 February, marking the fourth consecutive rate cut.
• The Committee assessed that annual consumer price inflation remains near the midpoint of the MPC’s 1 to 3% target band; inflation expectations are at target and core inflation continues to fall towards the target mid-point.
• Economic activity in New Zealand remains subdued and with spare productive capacity, domestic inflation pressures continue to ease. Price and wage-setting behaviours are adapting to a low-inflation environment while the price of imports has fallen, also contributing to lower headline inflation.
• Economic growth is expected to recover during 2025 as lower interest rates will encourage spending, although elevated global economic uncertainty is expected to weigh on business investment decisions. Higher prices for some key commodities and a lower exchange rate will increase export revenues and employment growth is expected to pick up in the second half of the year as the domestic economy recovers.
• Global economic growth is expected to remain subdued in the near term as geopolitics, including uncertainty about trade barriers, is likely to weaken global growth. Global economic activity is also likely to remain fragile over the medium term given increasing geoeconomic fragmentation.
• Consumer price inflation is expected to be volatile in the near term, due to a lower exchange rate and higher petrol prices. Nevertheless, the Committee is well placed to maintain price stability over the medium term.
• The economic outlook remains consistent with inflation remaining in the band over the medium term, giving the Committee confidence to continue lowering the OCR. If economic conditions continue to evolve as projected, the Committee has scope to lower the OCR further through 2025.
• The next meeting is on 9 April 2025.

Next 24 Hours Bias

Weak Bullish

The Japanese Yen (JPY)

Key news events today

BoJ Gov Ueda’s Speech (2:15 pm GMT)

What can we expect from JPY today?

Bank of Japan (BoJ) Governor Kazuo Ueda will deliver his opening remarks at an event hosted by the International Monetary Fund in Tokyo where he could provide further insights into the outlook for future monetary policy action. With the second central bank meeting of this year coming up in a couple of weeks, Governor Ueda could indicate how hawkish their stance currently sits given the recent increase in price pressures based on the various metrics on consumer inflation. The yen continued to see strong inflows as a result of global uncertainties arising from the implementation of trade tariffs.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 24 January, by an 8-1 majority vote, to set the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• Japan’s economy has recovered moderately, although some weakness has been seen in part. Exports and industrial production have been more or less flat while corporate profits have been on an improving trend and business sentiment has stayed at a favourable level.
• The employment and income situation has improved moderately while private consumption has been on a moderately increasing trend despite the impact of price rises and other factors.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been at around 3% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices have waned.
• Inflation expectations have risen moderately while underlying CPI inflation has been increasing gradually toward the price stability target of 2%. With wages continuing to rise, there has been an increase in moves to reflect higher costs, such as increased personnel expenses and distribution costs, in selling prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• The next meeting is on 19 March 2025.

Next 24 Hours Bias

Medium Bearish

The Euro (EUR)

Key news events today

Unemployment Rate (10:00 am GMT)

What can we expect from EUR today?

Manufacturing activity in the Euro Area has deteriorated for over two and a half years to highlight the ongoing weakness in this sector while inflationary pressures moderated lower in February, based on Monday’s reports. However, the Euro remained supported due to significant dollar weakness – this currency pair surged past 1.0500 overnight and the upward momentum will likely remain intact.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 30 January to mark the fourth successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.90%, 3.15% and 2.75% respectively.
• The disinflation process is well on track and inflation is set to return to the Governing Council’s 2% medium-term target in the course of this year. Most measures of underlying inflation suggest that inflation will settle at around the target on a sustained basis.
• Staff see headline inflation averaging 2.4% in 2024, 2.1% in 2025, 1.9% in 2026 and 2.1% in 2027 when the expanded EU Emissions Trading System becomes operational. For inflation excluding energy and food, staff project an average of 2.9% in 2024, 2.3% in 2025 and 1.9% in both 2026 and 2027.
• Staff now expect a slower economic recovery than in the September projections. Although growth picked up in the third quarter of this year, survey indicators suggest it has slowed in the current quarter – the economy is expected to grow by 0.7% in 2024, 1.1% in 2025, 1.4% in 2026 and 1.3% in 2027.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises sustainably at its 2% target over the medium term and to preserve the smooth functioning of monetary policy transmission.
• The next meeting is on 6 March 2025.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Rising uncertainties stemming from global trade tariffs resulted in a risk-off sentiment on Monday, triggering higher demand for safe-haven currencies such as the franc. This caused USD/CHF to tumble more than 0.5% overnight and the downward momentum continued as Asian markets came online on Tuesday – this currency pair dipped under 0.8650 and will likely remain under pressure.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 50 basis points, going from 1.00% to 0.50% on 12 December, marking the fourth consecutive reduction.
• Underlying inflationary pressure has decreased again this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected as it decreased from 1.1% in August to 0.7% in November; both goods and services contributed to this decline.
• In the shorter term, the new conditional inflation forecast is below that of September: 1.1% for 2024, 0.3% for 2025 and 0.8% for 2026, based on the assumption that the SNB policy rate is 0.5% over the entire forecast horizon.
• GDP growth in Switzerland was only modest in the third quarter of 2024 with growth in the services sector again somewhat stronger, while value added in manufacturing declined.
• There was a further slight increase in unemployment, and employment growth was subdued while the utilisation of overall production capacity was normal.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of between 1.0% and 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 20 March 2025.

Next 24 Hours Bias

Weak Bearish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

After expanding strongly for most parts of last year, manufacturing activity in the U.K. fell into contraction from October 2024 through January 2025 as sales weakened in both domestic and overseas markets while employment levels and unfinished business saw significant declines. This sector continued to deteriorate in February, falling from 48.3 in the previous month to 46.9. Not only did it mark a fifth consecutive month of contraction but it also fell to a 14-month low. Despite highlighting the prolonged weakness in manufacturing activity, demand for the pound remained steady, primarily due to a sharp sell-off in the greenback on Monday –  Cable reached an overnight high of 1.2724.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 7 to 2 to reduce the Bank Rate by 25 basis points (bps) to bring it down to 4.50% on 6 February 2025, while two members preferred to reduce it by 50 bps.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• CPI inflation was 2.5% in 2024 Q4 as domestic inflationary pressures moderated but remained somewhat elevated while some indicators eased more slowly than expected. Higher global energy costs and regulated price changes are expected to push up headline CPI inflation to 3.7% in 2025 Q3, even as underlying domestic inflationary pressures are expected to wane further.
• While CPI inflation is expected to fall back to around the 2% target thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• GDP growth has been weaker than expected at the time of the November Monetary Policy Report, and indicators of business and consumer confidence have declined – GDP growth is expected to pick up from the middle of this year.
• The labour market has continued to ease and is judged to be broadly in balance. Productivity growth has been weaker than previously estimated, and the Committee judges that growth in the supply capacity of the economy has weakened.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 8 May 2025.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

After expanding strongly in the final quarter of 2024 with PMI output hitting 52.2 in December before easing slightly to 51.6 in January, manufacturing output contracted sharply in February with a reading of 47.8 as both output and new orders declined. This was largely attributed to considerable market uncertainty related to tariff concerns. With the impending trade tariffs on Canada’s exports to the U.S. set to take effect on Tuesday, overhead pressures for the Loonie are set to ratchet up. USD/CAD hit an overnight high of 1.4541 before pulling back – this currency pair was hovering around 1.4490 at the beginning of the Asia session.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points bringing it down to 3% on 29 January; this marked the sixth consecutive meeting where rates were reduced.
• The bank announced its plan to complete the normalization of its balance sheet, ending quantitative tightening, and will restart asset purchases in early March, beginning gradually so that its balance sheet stabilizes and then grows modestly, in line with growth in the economy.
• Past cuts to interest rates have started to boost the economy and the recent strengthening in both consumption and housing activity is expected to continue. However, business investment remains weak while the outlook for exports is being supported by new export capacity for oil and gas.
• The Bank forecasts GDP growth will strengthen in 2025 and now projects GDP will grow by 1.8% in both 2025 and 2026, somewhat higher than potential growth.
• The labour market remains soft, with the unemployment rate at 6.7% in December. Job growth has strengthened in recent months, after lagging growth in the labour force for more than a year. Wage pressures, which have proven sticky, are showing some signs of easing.
• CPI inflation remains close to 2%, with some volatility due to the temporary suspension of the GST/HST on some consumer products. Shelter price inflation is still elevated but it is easing gradually, as expected.
• A broad range of indicators, including surveys of inflation expectations and the distribution of price changes among components of the CPI, suggests that underlying inflation is close to 2% with forecasts that CPI inflation will be around the 2% target over the next two years.
• With inflation around 2%, the economy in excess supply, and recent indicators tilted towards softer growth than projected, the Governing Council decided to reduce the policy rate a further 25 basis points to support growth and keep inflation close to the middle of the 1-3% target range.
• The cumulative reduction in the policy rate since last June is substantial as lower interest rates are boosting household spending and the economy is expected to strengthen gradually and inflation to stay close to target. However, if broad-based and significant tariffs were imposed, the resilience of Canada’s economy would be tested.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• The next meeting is on 12 March 2025.

Next 24 Hours Bias

Medium Bullish

Oil

Key news events today

API Crude Oil Stock (9:30 pm GMT)

What can we expect from Oil today?

Selling pressures for crude oil intensified on Monday as reports indicated OPEC+ will proceed with a planned oil output increase in April. In addition, concerns continue to mount on the premise that U.S. tariffs could hurt global economic growth and oil demand during the course of the year – WTI oil declined 2.3% as it dived to an overnight low of $67.89 per barrel. Moving over to U.S. inventories, the API stockpiles registered its first draw in six weeks in the most recent report. However, crude oil remains under pressure and a second successive week of higher drawdowns may be insufficient to support prices.

Next 24 Hours Bias

Medium Bearish

The post IC Markets Europe Fundamental Forecast | 4 March 2025 first appeared on IC Markets | Official Blog.

Dear Client,

Please find our updated Trading schedule and general information related to the South Africa Human Rights Day on Friday, 21 March, 2025. 

Liquidity over the holidays is expected to be particularly thin so please take the necessary precaution to ensure that you are not affected by increased volatility, spreads and intermittent pricing.

Kind regards,

IC Markets Global.

The post South Africa Human Rights Day Trading Schedule – 2025 first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 106.51
Supporting reasons: Identified as a pullback support that aligns close to the 78.6% Fibonacci retracement, indicating a potential area where price could rebound.

1st support: 106.09
Supporting reasons: Identified as a swing low support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 107.21
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price could potentially drop further to the pivot in the short term before bouncing from there and rising to the 1st resistance.

Pivot: 1.0410
Supporting reasons: Identified as a pullback support, indicating a potential area where price could rebound.

1st support: 1.0327
Supporting reasons: Identified as an overlap support that aligns with the 161.8% Fibonacci retracement, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 1.0520
Supporting reasons: Identified as a multi swing high resistance, indicating a potential level where price could face selling pressure.

EUR/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 156.09
Supporting reasons: Identified as a multi-swing low support, indicating a potential area where price could rebound.

1st support: 154.82
Supporting reasons: Identified as a swing low support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 158.37
Supporting reasons: Identified as an overlap resistance that aligns with 50% Fibonacci retracement,  indicating a potential level where price could face selling pressure.

EUR/GBP:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a short-term rise toward the pivot before reversing and falling toward the 1st support.

Pivot: 0.8272
Supporting reasons: Identified as a pullback resistance that aligns with the 50% Fibonacci retracement,, indicating a potential area where selling pressure could emerge.

1st support: 0.8241
Supporting reasons: Identified as a swing low support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 0.8304
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

GBP/USD:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish continuation toward the 1st support.

Pivot: 1.2501
Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressure could emerge.

1st support: 1.2624
Supporting reasons: Identified as a pullback support that aligns with the 61.8% Fibonacci retracement, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 1.2797
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 188.87
Supporting reasons: Identified as an overlap support that aligns close to the 78.6% Fibonacci retracement, indicating a potential area where price could rebound.

1st support: 187.11
Supporting reasons: Identified as a swing low support, indicating a potential level where price could stabilize before continuing higher.

1st resistance: 190.72
Supporting reasons: Identified as a pullback resistance, indicating a potential level where price could face selling pressure.

USD/CHF:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 0.8950
Supporting reasons: Identified as an overlap support that aligns close to the 78.6% Fibonacci retracement, indicating a potential area where price could rebound.

1st support: 0.8913
Supporting reasons: Identified as a swing low support,  indicating a potential level where price could face selling pressure.

1st resistance: 0.8994
Supporting reasons: Identified as a pullback resistance, indicating a potential level where price could face selling pressure.

USD/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 148.93
Supporting reasons: Identified as a multi swing low support, indicating a potential area where price could rebound.

1st support: 146.84
Supporting reasons: Identified as a support that aligns with the 161.8% Fibonacci extension, suggesting a potential area where price could stabilize before resuming its upward movement.

1st resistance: 150.49
Supporting reasons: Identified as a pullback resistance, indicating a potential level where price could face selling pressure.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bullish

Price is rising towards the pivot and could potentially make a bearish reversal off this level to pull back towards the 1st support.

Pivot: 1.4537

Supporting reasons:  Identified as a multi-swing-high resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 1.4403
Supporting reasons: Identified as a multi-swing-low support that aligns close to a 38.2% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 1.4749
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.6177

Supporting reasons: Identified as an overlap support that aligns close to a 127.2% Fibonacci extension, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 0.6114

Supporting reasons: Identified as a swing-low support, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6246
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement. The presence of the red Ichimoku Cloud and the descending trendline adds further significance to the strength of the bearish momentum.

NZD/USD

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.5580

Supporting reasons: Identified as an overlap support that aligns close to a 78.6% Fibonacci retracement, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 0.5538

Supporting reasons: Identified as a swing-low support, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.5633

Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement. The presence of the red Ichimoku Cloud and the descending trendline adds further significance to the strength of the bearish momentum.

US30 (DJIA):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 42,879.91

Supporting reasons: Identified as a pullback support that aligns close to a 61.8% Fibonacci retracement, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 41,674.92

Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 43,767.52

Supporting reasons: Identified as an overlap resistance that aligns close to a 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

DE40 (DAX):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 22,735.10

Supporting reasons: Identified as a pullback support that aligns with a confluence of Fibonacci levels i.e. the 23.6% and 50% retracements, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 22,163.30

Supporting reasons: Identified as a multi-swing-low support that aligns close to a 50% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 23,133.40
Supporting reasons: Identified as a swing-high resistance that aligns close to the all-time high, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 5,777.80

Supporting reasons: Identified as a swing-low support that aligns close to a 161.8% Fibonacci extension, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 5,700.70

Supporting reasons: Identified as a multi-swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 5,923.40

Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

BTC/USD (Bitcoin):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 86,790.64

Supporting reasons: Identified as an overlap resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 80,139.21
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 94,030.59
Supporting reasons: Identified as an overlap resistance that aligns close to a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 2,264.16

Supporting reasons: Identified as a pullback resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 1,941.81
Supporting reasons: Identified as a support that aligns with a 127.2% Fibonacci extension, indicating a potential level where the price could stabilize.

1st resistance: 2,519.42
Supporting reasons: Identified as an overlap resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 68.97

Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 67.15
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 70.40
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bearish
Overall momentum of the chart: Bullish
Price could potentially make a bearish reversal off the pivot and fall toward the 1st support.

Pivot: 2898.72
Supporting reasons: Identified as a pullback resistance that aligns with the 50% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 2835.05
Supporting reasons: Identified as a swing low support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 2923.51
Supporting reasons: Identified as an overlap resistance, indicating a potential level where price could face selling pressure.

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The post Tuesday 4th March 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 4 March 2025

What happened in the U.S. session?

The Institute for Supply Management (ISM) released February’s manufacturing PMI report which showed this sector expanding for the second month in a row. However, sub-indices such as new orders contracted quite sharply while production and new export orders grew at a slower pace, indicating a potential stall in activity for March. The greenback saw no love on Monday as selling pressures picked up strongly, prompting the dollar index (DXY) to dive over 1% overnight. This index hovered around 106.50 as Asian markets came online on Tuesday but overheard pressures remain firmly in place.

What does it mean for the Asia Session?

After unexpectedly falling in December to mark the first decline in nine months, consumer spending rebounded in January as sales increased 0.3% MoM. The upturn was supported by an increase in categories such as cafes, restaurants and takeaway food services; food retailing; and clothing, footwear and personal accessory retailing. However, the RBA minutes were also released at the same time which indicated a shift in focus toward easing monetary conditions by this central bank, putting downward pressure on the Aussie – this currency pair was drifting towards 0.6200 as Asian markets came online.

The Dollar Index (DXY)

Key news events today

FOMC Member Williams’ Speech (7:20 pm GMT)

What can we expect from DXY today?

Federal Reserve Bank of New York President John Williams is due to speak at the Bloomberg Invest Forum in New York where audience questions are expected. Given the current backdrop of global trade tariffs being imposed on the major trading partners of the United States, NY Fed President Williams could shed some light on how these events may impact the Fed’s decision-making process ahead of the FOMC meeting that is lined up in a couple of weeks.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 29 January.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilized at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• December’s Summary of Economic Projections (SEP) now indicates just two rate cuts in 2025 totalling 50 bps, compared to the full percentage point of reductions projected in the previous quarter.
• GDP growth forecasts were revised upward for 2024 (2.5% vs. 2% in the September projection) and 2025 (2.1% vs. 2%), while remaining steady at 2% for 2026. Similarly, PCE inflation projections have been adjusted higher for 2024 (2.4% vs. 2.3%), 2025 (2.5% vs. 2.1%), and 2026 (2.1% vs. 2%).
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• The Committee will roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing in each calendar month that exceeds a cap of $25 billion per month and redeem Treasury coupon securities up to this monthly cap and Treasury bills to the extent that coupon principal payments are less than the monthly cap.
• In addition, the Committee will reinvest the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency mortgage-backed securities (MBS) received in each calendar month that exceeds a cap of $35 billion per month into Treasury securities to roughly match the maturity composition of Treasury securities outstanding.
• The next meeting runs from 18 to 19 March 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

FOMC Member Williams’ Speech (7:20 pm GMT)

What can we expect from Gold today?

Federal Reserve Bank of New York President John Williams is due to speak at the Bloomberg Invest Forum in New York where audience questions are expected. Given the current backdrop of global trade tariffs being imposed on the major trading partners of the United States, NY Fed President Williams could shed some light on how these events may impact the Fed’s decision-making process ahead of the FOMC meeting that is lined up in a couple of weeks. Spot prices for gold stabilized around $2,860/oz on Monday before climbing higher towards $2,890/oz.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

RBA Monetary Policy Meeting Minutes (12:30 am GMT)

Retail Sale (12:30 am GMT)

What can we expect from AUD today?

After unexpectedly falling in December to mark the first decline in nine months, consumer spending rebounded in January as sales increased 0.3% MoM. The upturn was supported by an increase in categories such as cafes, restaurants and takeaway food services; food retailing; and clothing, footwear and personal accessory retailing. However, the RBA minutes were also released at the same time which indicated a shift in focus toward easing monetary conditions by this central bank, putting downward pressure on the Aussie – this currency pair was drifting towards 0.6200 as Asian markets came online.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 January, marking the first rate cut since November 2020.
• Financial conditions are restrictive, which is weighing on demand and is helping to bring down underlying inflation; growth in private demand has been subdued.
• Underlying inflation has moderated over the past three quarters with trimmed mean inflation easing to 3.2% over 2024 and it is expected to reach the 2–3% target range in early 2025, which is sooner than expected at the time of the November Statement.
• The unemployment rate declined a little in late 2024 to 4% with much of the strength in the labour market underpinned by strong employment growth, which has also bolstered household incomes.
• The announcement of tariffs between the United States and other major economies poses challenges to the global outlook but the scale and incidence of the tariffs and their effects remain highly uncertain – which may itself delay some investment until the outlook becomes clearer.
• Economic activity strengthened in China but growth there is still facing structural headwinds while domestic economic growth is forecast to pick up and the labour market is forecast to remain tight.
• If the cash rate follows the market path, underlying inflation is projected to be a little above 2.5% over most of the forecast period. The anticipated recovery of GDP growth and lingering tightness in labour market conditions are expected to sustain some upward pressure on inflation.
• Sustainably returning inflation to target within a reasonable timeframe remains the Board’s highest priority. This is consistent with the RBA’s mandate for price stability and full employment.
• The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions, paying close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
• The next meeting is on 1 April 2025.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi will likely take its cue from its Pacific neighbour and it could be dragged down by the Aussie as the RBA indicated a shift in focus toward easing monetary conditions in its meeting minutes released on early Tuesday. The Kiwi was floating above 0.5600 at the beginning of the Asia session.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 50 basis points bringing it down to 3.75% on 19 February, marking the fourth consecutive rate cut.
• The Committee assessed that annual consumer price inflation remains near the midpoint of the MPC’s 1 to 3% target band; inflation expectations are at target and core inflation continues to fall towards the target mid-point.
• Economic activity in New Zealand remains subdued and with spare productive capacity, domestic inflation pressures continue to ease. Price and wage-setting behaviours are adapting to a low-inflation environment while the price of imports has fallen, also contributing to lower headline inflation.
• Economic growth is expected to recover during 2025 as lower interest rates will encourage spending, although elevated global economic uncertainty is expected to weigh on business investment decisions. Higher prices for some key commodities and a lower exchange rate will increase export revenues and employment growth is expected to pick up in the second half of the year as the domestic economy recovers.
• Global economic growth is expected to remain subdued in the near term as geopolitics, including uncertainty about trade barriers, is likely to weaken global growth. Global economic activity is also likely to remain fragile over the medium term given increasing geoeconomic fragmentation.
• Consumer price inflation is expected to be volatile in the near term, due to a lower exchange rate and higher petrol prices. Nevertheless, the Committee is well placed to maintain price stability over the medium term.
• The economic outlook remains consistent with inflation remaining in the band over the medium term, giving the Committee confidence to continue lowering the OCR. If economic conditions continue to evolve as projected, the Committee has scope to lower the OCR further through 2025.
• The next meeting is on 9 April 2025.

Next 24 Hours Bias

Weak Bullish

The Japanese Yen (JPY)

Key news events today

BoJ Gov Ueda’s Speech (2:15 pm GMT)

What can we expect from JPY today?

Bank of Japan (BoJ) Governor Kazuo Ueda will deliver his opening remarks at an event hosted by the International Monetary Fund in Tokyo where he could provide further insights into the outlook for future monetary policy action. With the second central bank meeting of this year coming up in a couple of weeks, Governor Ueda could indicate how hawkish their stance currently sits given the recent increase in price pressures based on the various metrics on consumer inflation. The yen continued to see strong inflows as a result of global uncertainties arising from the implementation of trade tariffs.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 24 January, by an 8-1 majority vote, to set the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• Japan’s economy has recovered moderately, although some weakness has been seen in part. Exports and industrial production have been more or less flat while corporate profits have been on an improving trend and business sentiment has stayed at a favourable level.
• The employment and income situation has improved moderately while private consumption has been on a moderately increasing trend despite the impact of price rises and other factors.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been at around 3% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices have waned.
• Inflation expectations have risen moderately while underlying CPI inflation has been increasing gradually toward the price stability target of 2%. With wages continuing to rise, there has been an increase in moves to reflect higher costs, such as increased personnel expenses and distribution costs, in selling prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• The next meeting is on 19 March 2025.

Next 24 Hours Bias

Medium Bearish

The Euro (EUR)

Key news events today

Unemployment Rate (10:00 am GMT)

What can we expect from EUR today?

Manufacturing activity in the Euro Area has deteriorated for over two and a half years to highlight the ongoing weakness in this sector while inflationary pressures moderated lower in February, based on Monday’s reports. However, the Euro remained supported due to significant dollar weakness – this currency pair surged past 1.0500 overnight and the upward momentum will likely remain intact.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 30 January to mark the fourth successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.90%, 3.15% and 2.75% respectively.
• The disinflation process is well on track and inflation is set to return to the Governing Council’s 2% medium-term target in the course of this year. Most measures of underlying inflation suggest that inflation will settle at around the target on a sustained basis.
• Staff see headline inflation averaging 2.4% in 2024, 2.1% in 2025, 1.9% in 2026 and 2.1% in 2027 when the expanded EU Emissions Trading System becomes operational. For inflation excluding energy and food, staff project an average of 2.9% in 2024, 2.3% in 2025 and 1.9% in both 2026 and 2027.
• Staff now expect a slower economic recovery than in the September projections. Although growth picked up in the third quarter of this year, survey indicators suggest it has slowed in the current quarter – the economy is expected to grow by 0.7% in 2024, 1.1% in 2025, 1.4% in 2026 and 1.3% in 2027.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises sustainably at its 2% target over the medium term and to preserve the smooth functioning of monetary policy transmission.
• The next meeting is on 6 March 2025.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Rising uncertainties stemming from global trade tariffs resulted in a risk-off sentiment on Monday, triggering higher demand for safe-haven currencies such as the franc. This caused USD/CHF to tumble more than 0.5% overnight and the downward momentum continued as Asian markets came online on Tuesday – this currency pair dipped under 0.8650 and will likely remain under pressure.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 50 basis points, going from 1.00% to 0.50% on 12 December, marking the fourth consecutive reduction.
• Underlying inflationary pressure has decreased again this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected as it decreased from 1.1% in August to 0.7% in November; both goods and services contributed to this decline.
• In the shorter term, the new conditional inflation forecast is below that of September: 1.1% for 2024, 0.3% for 2025 and 0.8% for 2026, based on the assumption that the SNB policy rate is 0.5% over the entire forecast horizon.
• GDP growth in Switzerland was only modest in the third quarter of 2024 with growth in the services sector again somewhat stronger, while value added in manufacturing declined.
• There was a further slight increase in unemployment, and employment growth was subdued while the utilisation of overall production capacity was normal.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of between 1.0% and 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 20 March 2025.

Next 24 Hours Bias

Weak Bearish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

After expanding strongly for most parts of last year, manufacturing activity in the U.K. fell into contraction from October 2024 through January 2025 as sales weakened in both domestic and overseas markets while employment levels and unfinished business saw significant declines. This sector continued to deteriorate in February, falling from 48.3 in the previous month to 46.9. Not only did it mark a fifth consecutive month of contraction but it also fell to a 14-month low. Despite highlighting the prolonged weakness in manufacturing activity, demand for the pound remained steady, primarily due to a sharp sell-off in the greenback on Monday –  Cable reached an overnight high of 1.2724.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 7 to 2 to reduce the Bank Rate by 25 basis points (bps) to bring it down to 4.50% on 6 February 2025, while two members preferred to reduce it by 50 bps.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• CPI inflation was 2.5% in 2024 Q4 as domestic inflationary pressures moderated but remained somewhat elevated while some indicators eased more slowly than expected. Higher global energy costs and regulated price changes are expected to push up headline CPI inflation to 3.7% in 2025 Q3, even as underlying domestic inflationary pressures are expected to wane further.
• While CPI inflation is expected to fall back to around the 2% target thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• GDP growth has been weaker than expected at the time of the November Monetary Policy Report, and indicators of business and consumer confidence have declined – GDP growth is expected to pick up from the middle of this year.
• The labour market has continued to ease and is judged to be broadly in balance. Productivity growth has been weaker than previously estimated, and the Committee judges that growth in the supply capacity of the economy has weakened.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 8 May 2025.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

After expanding strongly in the final quarter of 2024 with PMI output hitting 52.2 in December before easing slightly to 51.6 in January, manufacturing output contracted sharply in February with a reading of 47.8 as both output and new orders declined. This was largely attributed to considerable market uncertainty related to tariff concerns. With the impending trade tariffs on Canada’s exports to the U.S. set to take effect on Tuesday, overhead pressures for the Loonie are set to ratchet up. USD/CAD hit an overnight high of 1.4541 before pulling back – this currency pair was hovering around 1.4490 at the beginning of the Asia session.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points bringing it down to 3% on 29 January; this marked the sixth consecutive meeting where rates were reduced.
• The bank announced its plan to complete the normalization of its balance sheet, ending quantitative tightening, and will restart asset purchases in early March, beginning gradually so that its balance sheet stabilizes and then grows modestly, in line with growth in the economy.
• Past cuts to interest rates have started to boost the economy and the recent strengthening in both consumption and housing activity is expected to continue. However, business investment remains weak while the outlook for exports is being supported by new export capacity for oil and gas.
• The Bank forecasts GDP growth will strengthen in 2025 and now projects GDP will grow by 1.8% in both 2025 and 2026, somewhat higher than potential growth.
• The labour market remains soft, with the unemployment rate at 6.7% in December. Job growth has strengthened in recent months, after lagging growth in the labour force for more than a year. Wage pressures, which have proven sticky, are showing some signs of easing.
• CPI inflation remains close to 2%, with some volatility due to the temporary suspension of the GST/HST on some consumer products. Shelter price inflation is still elevated but it is easing gradually, as expected.
• A broad range of indicators, including surveys of inflation expectations and the distribution of price changes among components of the CPI, suggests that underlying inflation is close to 2% with forecasts that CPI inflation will be around the 2% target over the next two years.
• With inflation around 2%, the economy in excess supply, and recent indicators tilted towards softer growth than projected, the Governing Council decided to reduce the policy rate a further 25 basis points to support growth and keep inflation close to the middle of the 1-3% target range.
• The cumulative reduction in the policy rate since last June is substantial as lower interest rates are boosting household spending and the economy is expected to strengthen gradually and inflation to stay close to target. However, if broad-based and significant tariffs were imposed, the resilience of Canada’s economy would be tested.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• The next meeting is on 12 March 2025.

Next 24 Hours Bias

Medium Bullish

Oil

Key news events today

API Crude Oil Stock (9:30 pm GMT)

What can we expect from Oil today?

Selling pressures for crude oil intensified on Monday as reports indicated OPEC+ will proceed with a planned oil output increase in April. In addition, concerns continue to mount on the premise that U.S. tariffs could hurt global economic growth and oil demand during the course of the year – WTI oil declined 2.3% as it dived to an overnight low of $67.89 per barrel. Moving over to U.S. inventories, the API stockpiles registered its first draw in six weeks in the most recent report. However, crude oil remains under pressure and a second successive week of higher drawdowns may be insufficient to support prices.

Next 24 Hours Bias

Medium Bearish

The post IC Markets Asia Fundamental Forecast | 4 March 2025 first appeared on IC Markets | Official Blog.

US Markets Smashed as Tariffs Hit – Nasdaq Down 2.6%

US stocks took a substantial hit in trading yesterday after President Trump confirmed that tariffs will go ahead on imports from Mexico and Canada. The Dow dropped 1.48%, the S&P 500 fell 1.76%—its biggest daily loss since December 18—and the Nasdaq was hit hardest, finishing the day down 2.64%.

US Treasury yields continued to fall as manufacturing data came in weaker than expected, with the 2-year yield finishing down 4 basis points at 3.949% and the 10-year dropping 5.3 basis points to 4.155%. The dollar played a bit of “catch-up” with Treasury yields, with the DXY falling by over 1% on the day to close at 106.55, down from a high of 107.66 the day before.

Oil prices also took a hit following the tariff news and reports that OPEC+ will increase output levels in April. Brent crude fell 1.80% to $71.50, while WTI dropped 1.99% to $68.37. Meanwhile, gold pushed higher in line with a weaker dollar and tariff concerns, closing the day at $2,891.72, up 1.28%.

Oil Prices Looking Vulnerable

Oil prices declined further last night as President Trump announced that tariffs on Canada and Mexico would take effect today. Additionally, reports confirmed that OPEC+ will proceed with plans to increase output in April. Both major contracts, Brent and WTI, closed at their lowest levels since early December.

Talk of a potential truce in the war between Ukraine and Russia, which could lead to a lifting of sanctions on Russia, may also push oil prices lower in the coming days. WTI hit a low just above $65 a barrel in 2024, and a technical breakdown of current support levels could see this price being tested relatively soon. A long-term break below that annual low could open the door for a much larger market correction in the months ahead.

Quiet Calendar Day Ahead for Traders

It is likely to be the quietest day of the week for traders in terms of macroeconomic updates, though many expect plenty of volatility following the significant market moves overnight.

The Asian session does feature some potentially market-moving events, with Bank of Japan Governor Kazuo Ueda set to speak early in the day in Tokyo. Focus will then shift to Australian markets for the Reserve Bank of Australia’s latest Monetary Policy Meeting Minutes and Retail Sales data.

There is little scheduled for either the London session or the New York trading day today. However, as always, traders will be keeping a close eye on newswires for any geopolitical developments.

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Global Markets:

•  Asian Stock Markets : Nikkei up 1.78%, Shanghai Composite up 0.33%, Hang Seng up 1.49% ASX up 0.94%
• Commodities : Gold at $2875.35 (0.93%), Silver at $31.85 (0.8%), Brent Oil at $73.37 (0.55%), WTI Oil at $70.58 (0.48%)
• Rates : US 10-year yield at 4.235, UK 10-year yield at 4.4835, Germany 10-year yield at 2.3860

News & Data:

• (CAD) GDP m/m 0.2%  to 0.3% expected
• (USD) Core PCE Price Index m/m 0.3%  to 0.3% expected

Markets Update:

Asia-Pacific markets mostly rose Monday as investors awaited clarity on U.S. President Donald Trump’s tariff plans. U.S. Commerce Secretary Howard Lutnick stated that tariffs on Mexico and Canada, set to begin Tuesday, remain “fluid” and could be lower than the proposed 25%, while the additional 10% duty on Chinese imports is confirmed.

Japan’s Nikkei 225 gained 1.7% to close at 37,785.47, while the Topix rose 1.77% to 2,729.56. Hong Kong’s Hang Seng index climbed 0.44%, but China’s CSI 300 dipped 0.04% to 3,888.47. Taiwan’s Taiex fell 1.29% to 22,756.25, its lowest since February, while Australia’s S&P/ASX 200 rose 0.9% to 8,245.7. China’s Caixin/S&P Global manufacturing PMI stood at 50.8, exceeding forecasts, while Australia’s PMI came in at 50.4, little changed from January.

Investors are watching Indian markets after the economy grew 6.2% year-on-year in Q3, recovering from a seven-quarter low and surpassing the revised 5.6% growth in Q2. South Korean markets were closed for a public holiday.

In the U.S., major indices closed higher Friday after a volatile week. The S&P 500 climbed 1.59% to 5,954.50, the Dow Jones gained 1.39% to 43,840.91, and the Nasdaq advanced 1.63% to 18,847.28. Markets briefly dipped due to tensions between Trump and Zelenskyy regarding the Russia-Ukraine conflict before rebounding on index rebalancing and technical buying.

Upcoming Events: 

• 03:00 PM GMT – USD ISM Manufacturing PMI
• 03:00 PM GMT – USD ISM Manufacturing Prices

The post Monday 3rd March 2025: Asia-Pacific Markets Rise as Investors Await U.S. Tariff Clarity first appeared on IC Markets | Official Blog.

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