What a difference six months can make in terms of how the market perceives things. Back in October, traders took to the prospect of Trump’s presidency and tariffs in the fear that it will stir up inflation. There weren’t too much concerns about the health of the global economy with the US also looking poised for a soft landing and the Fed still squeezing in rate cuts.

Fast forward to this week and suddenly, the script has flipped on its head. Global growth worries and anxiety about how this will all continue to play out is outweighing any potential impact to inflation.

The flight to safety in bonds with heavy selling in equities so far today shows how risk sentiment is being beaten up following Trump’s tariffs announcement.

The biggest blow is arguably the steep tariffs on China but there also big ones announced all over as the 10% tariffs bar turned out to be the minimum.

Volatility has returned to markets in a big way but that doesn’t mean that we’re capturing the full extent of the impact of Trump’s tariffs here. There’s still so much uncertainty up in the air and it will take some time for liquidity to make its way back, so that will exacerbate some of the market moves in the meantime.

In any case, the bond market is suggesting that fear is prevailing and with the drop in yields we are also seeing USD/JPY teetering closer towards 147.00 on the day.

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

• Shares serious concern whether US tariffs are compatible with trade agreements
• Will continue to demand US to reconsider tariff measures
• Will not hesitate to directly approach US president Trump if appropriate

In other words, they won’t be doing anything and that is as expected considering the nature of their alliance. Japan was slapped with 24% tariffs as noted here.

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

When Trump was set to win the presidential election last October, this is one chart that clearly shows how China chose to respond. The fear was an escalation in trade conflict as he takes office. And when that didn’t turn out too bad in January, the Chinese yuan managed to find some stability. That is until today I guess.

USD/CNY has now jumped to 7.30 at its highest in eight weeks. And if anything, it once again shows how Beijing might choose to respond towards Trump’s latest tariffs announcement.

In case you missed it:

• Here’s the full list tariff war declaration
• Trump slams China with a 54% tariff rate
• Trump’s 54% tariffs bring China close to ‘worst case’ scenario, PBOC easing soon
• China’s Commerce Ministry says will take countermeasures on Trump’s tariffs

It’s crazy to imagine how steep he actually did go with tariffs against China. That certainly wasn’t really expected and you can see how risk trades have been shaken up by that. It’s a major blow to global growth prospects.

Going back to the yuan, the comfort for China is that they have prepared for this somewhat since October last year. They allowed the yuan to weaken by over 4%, so they might not overreact for now. But in any case, this will surely mean more easing policy to be announced sooner rather than later.

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

Stocks Affected by Trump Tariffs – and What You Can Do

President Trump’s surprise announcement of sweeping new tariffs is shaking up global markets and triggering significant moves in key US stocks. The new tariff policy introduces a minimum 10% import tax and much higher tariffs on specific trade partners.

• China: 34%

• Japan: 24%

• Vietnam: 46%

• South Korea: 25%

• European Union: 20%

These tariffs are designed to reduce America’s reliance on foreign manufacturing, but they are already disrupting global trade and impacting major companies in the S&P 500 and Nasdaq 100 indices.

Most Affected US Stocks by Trump Tariffs

Several high-profile American companies are directly exposed to these tariffs because of their dependence on manufacturing, assembly, or supply chains in China, Vietnam, Japan, and other targeted countries.

Here is a clear list of the stocks affected by Trump tariffs and their market reaction:

The broader stock market sold off immediately after the tariff announcement:

• S&P 500 futures declined nearly 4%.

• Nasdaq-100 futures fell almost 5%.

• Dow futures dropped over 2.5%.

These declines reflect investor concerns about rising production costs, shrinking profit margins, and reduced consumer demand due to higher product prices.

US Stocks That Could Benefit from Trump Tariffs

While multinational companies are facing tariff pressure, some US-focused stocks may actually benefit. Higher import taxes make foreign-made goods more expensive, potentially giving American producers and domestic retailers a competitive edge.

Here are examples of stocks that may benefit from Trump tariffs:

Possible Ways Stock Investors Can Play This

Many investors look to buy fundamentally strong stocks such as Costco (COST) during periods of market turmoil. However, it is important to avoid rushing into a position if the S&P 500 or Nasdaq is still falling.

Here is a structured approach:

1. Wait for Market Bottoming Signs

Even strong stocks can get dragged lower by overall market weakness. Watch for:

• Signs that the S&P 500 or Nasdaq is stabilizing.

• Signs that Costco is holding up better than the indices (showing relative strength).

2. Identify Divergences and Relative Strength

You can spot relative strength by:

• Comparing charts:
  Check if the index makes a new low while Costco does not.

• Using a relative strength ratio:
  Plot COST / S&P 500 or COST / Nasdaq-100.
  If the ratio is trending upward, Costco is outperforming.

Example behavior to monitor:

3. Use a Scaling-In Plan

Once Costco shows strength:

• Start with a small position.

• Add more if the market stabilizes and Costco breaks short-term resistance.

• Always set a stop-loss to control risk in case the market weakness continues.

4. Watch Volume and News

Relative strength is more reliable when:

• Costco’s green days are accompanied by higher-than-average volume.

• There is no negative company-specific news affecting Costco.

Professional traders know that the first stocks to hold steady or rally during a market pullback often become the leaders in the next market recovery. If Costco continues to show relative strength, it could be among the first to recover when market conditions improve. Follow the big news, monitor price action to see if it confirms, and be on the look out for intelligent live market news and original ideas to support your decisions at ForexLive.com (to be rebranded to investingLive.com by the end of this year… Get used to the new name).

Stocks Affected by Trump Tariffs – Wait for the Storm to Calm Down

The new tariffs are already causing significant disruptions in global trade and stock market performance.
Stocks affected by Trump tariffs include major multinationals like Apple, Nike, Tesla, Amazon, and Walmart. These companies face higher production costs and shrinking profit margins.

On the other hand, US-based manufacturers and domestic retailers such as Caterpillar, Deere, Alcoa, US Steel, Domino’s, Dollar General, Chipotle, and Costco may benefit from these tariffs.

For investors, the key is to time entries carefully.
If you are looking to buy strong stocks like Costco, wait for:

• Signs of market stabilization.

• Clear relative strength and divergence.

• Higher volume accumulation.

This approach will help you avoid unnecessary drawdowns and position yourself to capture upside when the market recovers.

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This article was written by Itai Levitan at www.forexlive.com.

DXY (US Dollar Index):

Potential Direction: Bullish

Overall momentum of the chart: Bearish

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

Pivot: 102.36
Supporting reasons: Identified as a pullback support that aligns with the 161.8% Fibonacci extension, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 101.80
Supporting reasons: Identified as a pullback support, indicating a potential area where the price could stabilize once again.

1st resistance: 103.21
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

EUR/USD:

Potential Direction: Bearish

Overall momentum of the chart: Bullish

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

Pivot: 1.1004
Supporting reasons: Identified as a pullback resistance that aligns with the 127.2% Fibonacci extension, indicating a potential area where selling pressures could intensify. 

1st support: 1.0867
Supporting reasons: Identified as a pullback support, indicating a potential area where the price could stabilize once more.

1st resistance: 1.1132
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

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

Pivot: 162.18
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 158.42
Supporting reasons: Identified as a pullback support that aligns with the 61.8% Fibonacci retracement, indicating a potential area where the price could stabilize once again.

1st resistance: 164.03
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

EUR/GBP:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

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

Pivot: 0.8378
Supporting reasons: Identified as an overlap resistance that aligns close to a 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify. 

1st support: 0.8324
Supporting reasons: Identified as a swing-low support that aligns close to the 61.8% Fibonacci retracement, indicating a potential area where the price could stabilize once more.

1st resistance: 0.8427
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 rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 1.3153
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 1.3007
Supporting reasons: Identified as a pullback support, acting as a potential level where the price could stabilize once again.

1st resistance: 1.3311
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

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

Pivot: 193.39
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 190.51
Supporting reasons: Identified as a pullback support that aligns with the 78.6% Fibonacci retracement, indicating a potential level where the price could stabilize once more.

1st resistance: 195.93
Supporting reasons: Identified as a swing-high resistance, indicating a potential level that could cap further upward movement.

USD/CHF:

Potential Direction: Bearish
Overall momentum of the chart: Neutral

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

Pivot: 0.8855
Supporting reasons: Identified as an overlap resistance that aligns with the 38.2% Fibonacci retracements, indicating a potential area where selling pressures could intensify.

1st support: 0.8758
Supporting reasons: Identified as a multi-swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 0.8917
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

USD/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

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

Pivot: 149.14
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressures could intensify.

1st support: 147.63
Supporting reasons: Identified as a swing low support that aligns with the 78.6% Fibonacci retracement, suggesting a potential area where the price could stabilize once more.

1st resistance: 151.24
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

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

Pivot: 1.4294

Supporting reasons: Identified as a pullback resistance that aligns with a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. 

1st support: 1.4156
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 1.4359
Supporting reasons: Identified as a multi-swing-high resistance that aligns close to a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish

Overall momentum of the chart: Neutral

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

Pivot: 0.6237
Supporting reasons: Identified as a swing-low support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 0.6194

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

1st resistance: 0.6307
Supporting reasons: Identified as a swing-high resistance that aligns with a confluence of Fibonacci retracements i.e. the 50% and 78.6% retracements, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish

Overall momentum of the chart: Neutral

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

Pivot: 0.5671
Supporting reasons: Identified as a swing-low support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 0.5637

Supporting reasons: Identified as an overlap support, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.5755

Supporting reasons: Identified as a multi-swing-high resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bullish
Overall momentum of the chart: Neutral

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

Pivot: 41,268.90

Supporting reasons: Identified as a multi-swing-low support that aligns close to a 78.6% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 40,673.30

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

1st resistance: 42,180.20

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

DE40 (DAX):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

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

Pivot: 22,080.30

Supporting reasons: Identified as a pullback resistance that aligns with a 50% 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: 21,528.30

Supporting reasons: Identified as an overlap support, indicating a key level where the price could stabilize once more.

1st resistance: 22,728.75
Supporting reasons: Identified as an overlap  resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bearish
Overall momentum of the chart: Bearish

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

Pivot: 5,593.30

Supporting reasons:  Identified as a pullback resistance that aligns with a 50% 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: 5,385.30

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

1st resistance: 5,716.50

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

BTC/USD (Bitcoin):

Potential Direction: Bullish
Overall momentum of the chart: Neutral

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

Pivot: 81,319.71

Supporting reasons: Identified as a multi-swing-low support that aligns with a 61.8% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 78,564.72
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 88,428.80
Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish
Overall momentum of the chart: Neutral

Price has made a bearish reversal off the pivot and could potentially fall toward the 1st support.

Pivot: 1,945.64

Supporting reasons: Identified as an overlap resistance that aligns close to a 50% 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: 1,782.58
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 2,105.19
Supporting reasons: Identified as an overlap resistance, 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 toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 70.34

Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressures could intensify. 

1st support: 68.85
Supporting reasons: Identified as an overlap support that aligns close to a 50% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 71.82
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 rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 3177.30
Supporting reasons: Identified as a resistance that aligns with the 78.6% Fibonacci projection and the 161.8% Fibonacci extension, indicating a potential area where selling pressures could intensify.

1st support: 3055.61
Supporting reasons: Identified as a pullback support that aligns close to the 61.8% Fibonacci retracement, acting as a potential level where price could stabilize once again.

1st resistance: 3220.29
Supporting reasons: Identified as a resistance that aligns with the 100% Fibonacci projection, indicating a potential area that could halt any further upward movement.

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The post Thursday 3rd April 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 3 April 2025

What happened in the U.S. session?

The latest announcements of tariffs by U.S. President Donald Trump on Liberation Day rattled financial markets, sparking fierce demand for safe-haven assets such as the Japanese yen, Swiss franc and of course precious metals such as gold. The ‘risk-off’ sentiment caused USD/JPY to dive under 148 as it shed over 1% while USD/CHF plummeted nearly 0.7% overnight – spot prices for gold surged over 1% as a new intraday high of $3,167.72/oz was recorded. Meanwhile, the dollar index (DXY) plunged over 0.6% to hover around the level of 103.

What does it mean for the Asia Session?

As Asian markets digest the latest tariff salvo, financial markets remain on edge as a ‘risk-off’ mood encompasses overall sentiment. The overnight moves are likely to gain further momentum as the day progresses.

The Dollar Index (DXY)

Key news events today

Unemployment Claims (12:30 pm GMT)

ISM Services PMI (2:00 pm GMT)

What can we expect from DXY today?

Unemployment claims have remained relatively low and stable over the past four weeks – a sign of a resilient labour market. The latest estimate of 225k points to another week of relatively low claims while the Institute for Supply Management (ISM) is anticipated to report services activity expanding robustly in March. However, given the latest slew of tariff announcements by U.S. President, financial markets have been turned on their heads with demand for the dollar tanking overnight.

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 19 March 2025
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run but uncertainty around the economic outlook has increased; 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.
• GDP growth forecasts were revised downward for 2025 (1.7% vs. 2.1% in the December projection) while PCE inflation projections have been adjusted slightly higher for 2025, with core inflation expected to reach 2.5%, partly due to tariff-related pressures.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and is prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of its goals.
• Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25B to $5B while maintaining the monthly redemption cap on agency debt and agency mortgage-backed securities at $35B.
• The next meeting is scheduled for 6 to 7 May 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

Unemployment Claims (12:30 pm GMT)

ISM Services PMI (2:00 pm GMT)

What can we expect from Gold today?

Unemployment claims have remained relatively low and stable over the past four weeks – a sign of a resilient labour market. The latest estimate of 225k points to another week of relatively low claims while the Institute for Supply Management (ISM) is anticipated to report services activity expanding robustly in March. However, given the latest slew of tariff announcements by U.S. President, financial markets have been turned on their heads with demand for safe-haven assets such as gold surging overnight.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

The Aussie initially dived from 0.6300 to as low as 0.6226 following the latest announcements of tariffs by U.S. President Donald Trump on Liberation Day. However, the Aussie recovered swiftly as demand for the greenback plummeted, triggering a sharp reversal – this currency pair bounced strongly back toward the 0.6300 mark as Asian markets came online.

Central Bank Notes:

• The RBA maintained the cash rate at 4.10% on 1 April, following a 25-basis point reduction on 18 February.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance.
• Recent information suggests that underlying inflation continues to ease in line with the most recent forecasts published in the February Statement on Monetary Policy.
• Private domestic demand appears to be recovering, real household incomes have picked up and there has been an easing in some measures of financial stress. However, businesses in some sectors continue to report that weakness in demand makes it difficult to pass on cost increases to final prices.
• At the same time, a range of indicators suggest that labour market conditions remain tight. Despite a decline in employment in February, measures of labour underutilisation are at relatively low rates and business surveys and liaison suggest that availability of labour is still a constraint for a range of employers. Wage pressures have eased a little more than expected but productivity growth has not picked up and growth in unit labour costs remains high.
• There are notable uncertainties about the outlook for domestic economic activity and inflation. The central projection is for growth in household consumption to continue to increase as income growth rises. But there is a risk that any pick-up in consumption is slower than expected, resulting in continued subdued output growth and a sharper deterioration in the labour market than currently expected.
• Uncertainty about the outlook abroad also remains significant. On the macroeconomic policy front, recent announcements from the U.S. on tariffs are having an impact on confidence globally and this would likely be amplified if the scope of tariffs widens, or other countries take retaliatory measures. Geopolitical uncertainties are also pronounced.
• The Board’s assessment is that monetary policy remains restrictive and the continued decline in underlying inflation is welcome, but there are nevertheless risks on both sides and the Board is cautious about the outlook.
• The Board will rely upon the data and the evolving assessment of risks to guide its decisions and is resolute in its determination to sustainably return inflation to target and will do what is necessary to achieve that outcome.
• The next meeting is on 20 May 2025.

Next 24 Hours Bias

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

Following the latest announcements of tariffs by U.S. President Donald Trump on Liberation Day, demand for the greenback tanked to provide a strong boost for the Kiwi. This currency pair rose strongly toward 0.5750 at the beginning of Thursday’s 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

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

The latest announcements of tariffs by U.S. President Donald Trump on Liberation Day rattled financial markets, sparking fierce demand for safe-haven assets such as the yen. The ‘risk-off’ sentiment caused USD/JPY to dive under 148 as it shed over 1% overnight – this currency pair continued to slide lower toward 147.50 as Asian markets came online.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 19 March, by a unanimous vote, to maintain 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 continue its plan to reduce the amount of its monthly outright purchases of JGBs, aiming to reach about 3 trillion yen by January-March 2026.
• Japan’s economy has continued to recover moderately, with some sectors showing improvement. Exports and industrial production have remained relatively stable, while corporate profits continue on an improving trend and business sentiment maintains a favourable level.
• The employment and income situation has shown moderate improvement, with private consumption on a moderately increasing trend despite ongoing impacts from price rises.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 3.0-3.5% recently. Services prices continue to rise moderately, reflecting factors such as wage increases, while the effects of cost pass-through from past import price rises have diminished.
• Inflation expectations have continued to rise moderately, with underlying CPI inflation gradually increasing toward the price stability target of 2%. The virtuous cycle between wages and prices continues to strengthen, with businesses increasingly reflecting higher costs in selling prices.
• Japan’s economy is expected to maintain growth above its potential rate, supported by moderately growing overseas economies and the intensifying virtuous cycle from income to spending, underpinned by accommodative financial conditions.
• The next meeting is scheduled for 19 June 2025.

Next 24 Hours Bias

Strong Bearish

The Euro (EUR)

Key news events today

Composite PMI (8:00 am GMT)

What can we expect from EUR today?

Composite PMI activity in the Euro Area is anticipated to edge higher from 50.2 in the previous month to 50.4 in March, based on the final estimates. Composite output had returned to expansion in January but growth has been marginal at best. The euro surged overnight to break past 1.0900 with ease and the upward momentum is likely to gain further traction as the day progresses.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 6 March to mark the fifth 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 2.65%, 2.90% and 2.50% respectively.
• The Council acknowledged that monetary policy was becoming meaningfully less restrictive, easing borrowing costs for businesses and households with inflation projected to average 2.3% in 2025, 1.9% in 2026, and 2.0% in 2027, while core inflation also neared the 2% target.
• Although domestic inflation remains elevated due to delayed wage and price adjustments, wage growth is moderating.
• Economic growth forecasts were revised downward to 0.9% for 2025 and 1.2% for 2026, reflecting weak exports and investment.
• 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 ECB remains data-dependent and will adjust its policy as needed to ensure inflation stabilizes around its 2% medium-term target without committing to a specific rate path.
• The next meeting is on 17 April 2025.

Next 24 Hours Bias

Medium Bullish

The Swiss Franc (CHF)

Key news events today

CPI (6:30 am GMT)

What can we expect from CHF today?

Inflationary pressures in Switzerland have dissipated significantly since the fourth quarter of 2022 with consumer inflation easing to an annual rate of 0.3% in February. Prices pressures are expected to moderate lower in March, a result that should dampen demand for the Swiss franc but financial markets have been rattled by the latest announcements of tariffs by U.S. President Donald Trump on Liberation Day. Demand for safe-haven assets such as the franc have surged, causing USD/CHF to dive nearly 0.7% overnight – this currency pair was hovering around 0.8770 at the beginning of the Asia session.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points, from 0.50% to 0.25% on 20 March 2025, marking the fifth consecutive reduction.
• Underlying inflationary pressure has decreased further this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected, decreasing from 0.7% in November to 0.3% in February, primarily due to lower electricity prices.
• In the shorter term, the new conditional inflation forecast is slightly higher than December: 0.3% for Q2 2025, 0.4% for 2025 overall, and 0.8% for 2026 and 2027, based on the assumption that the SNB policy rate remains at 0.25% over the entire forecast horizon.
• GDP growth in Switzerland remains moderate, with the services sector continuing to show slightly stronger growth, while manufacturing faces challenges.
• The SNB anticipates GDP growth of around 1.0% to 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 19 June 2025.

Next 24 Hours Bias

Medium Bearish

The Pound (GBP)

Key news events today

Composite PMI (8:30 am GMT)

What can we expect from GBP today?

The final Composite PMI reading for the U.K. is expected to increase to 52.0 in March from 51.0 in the previous month. This would mark the highest level of PMI activity in six months and could provide further lift for the pound as European trading gets underway.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to maintain the Bank Rate at 4.50% on 19 March 2025, while one member preferred to reduce it by 25 basis points (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.
• Twelve-month CPI inflation increased to 3.0% in January from 2.5% in December, slightly higher than expected in the February Report; domestic price and wage pressures are moderating, but remain somewhat elevated.
• Although global energy prices have fallen back recently, they remain higher than last year and CPI inflation is still projected to rise to around 3.75% in 2025 Q3. While CPI inflation is expected to fall back thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• While UK GDP growth estimates have been slightly stronger than expected at the time of the February Monetary Policy Report, business survey indicators generally continue to suggest weakness in growth and particularly in employment intentions. In recent quarters, subdued activity has been judged to reflect both demand and supply factors.
• The labour market had continued to ease, although it was still judged to be broadly in balance – some indicators of employment intentions had deteriorated markedly, to levels consistent with shrinking employment while other indicators, such as the number of vacancies, had not weakened to the same extent.
• Domestic price and wage pressures were moderating, but remained somewhat elevated. A range of indicators suggested that underlying pay growth had eased further in recent months, although annual growth in private sector regular average weekly earnings had picked up to 6.1% in the three months to January.
• 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

Medium Bullish

The Canadian Dollar (CAD)

Key news events today

Trade Balance (12:30 pm GMT)

What can we expect from CAD today?

Canada’s trade surplus widened to C$4.0B in January, the largest since May 2022 and well above market expectations of C$1.3B. Merchandise exports rose 5.5% to a record C$74.5B, while imports increased 2.3% to a record C$70.5B, marking the fourth consecutive monthly rise for both. Export growth was driven by motor vehicles and parts; energy products; and consumer goods. However, this surplus is now anticipated to narrow to C$3.4B in February – a drop of 15% – as the ongoing global trade tariffs ratcheted higher. However, the Loonie gained overnight as USD/CAD reversed off its highs of 1.4318 and dipped under 1.4300 – this currency pair was sliding toward 1.4250 as Asian markets came online on Thursday.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points bringing it down to 2.75% on 12 March; this marked the seventh 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.
• The Governing Council noted that the economy grew more than expected in the fourth quarter of last year, spurred by past rate cuts but growth is now expected to slow at the turn of the year due to increasing trade conflict with the United States.
• Employment growth strengthened in November through January and the unemployment rate declined to 6.6%. In February, job growth stalled. While past interest rate cuts have boosted demand for labour in recent months, there are warning signs that heightened trade tensions could disrupt the recovery in the jobs market. Meanwhile, wage growth has shown signs of moderation.
• Inflation remains close to the 2% target. The temporary suspension of the GST/HST lowered some consumer prices, but January’s CPI was slightly firmer than expected at 1.9%. Inflation is expected to increase to about 2½% in March with the end of the tax break. The Bank’s preferred measures of core inflation remain above 2%, mainly because of the persistence of shelter price inflation. Short-term inflation expectations have risen in light of fears about the impact of tariffs on prices.
• While economic growth has come in stronger than expected, the pervasive uncertainty created by continuously changing U.S. tariff threats is restraining consumers’ spending intentions and businesses’ plans to hire and invest.
• While monetary policy cannot offset the impacts of a trade war, the Governing Council will carefully assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs.
• The Council will also be closely monitoring inflation expectations and is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• The next meeting is on 16 April 2025.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

Caixin Services PMI (1:45 am GMT)

What can we expect from Oil today?

The latest announcements of tariffs by U.S. President Donald Trump on Liberation Day rattled financial markets as concerns over a major global trade war escalated, significantly increasing the probability of a notable slowdown in global economic activity. Despite an exemption of tariffs on imports of oil, gas and refined products, providing some relief to the U.S. oil industry, crude oil prices slumped with WTI oil plunging over 3% as it tumbled towards the mark of $69 per barrel. In addition, the EIA crude oil inventories registered a strong build of 6.2M barrels of crude, exceeding the 6M rise in inventories as reported by the API on Tuesday. After four weeks of robust gains, overhead pressures for this commodity have intensified and prices are now subjected to head lower.

Next 24 Hours Bias

Medium Bearish

The post IC Markets Asia Fundamental Forecast | 3 April 2025 first appeared on IC Markets | Official Blog.

• European Commission President von der Leyen says US tariffs a major blow to world economy
• ICYMI – China will raise the retail prices of gasoline and diesel from today
• RBC says rising global trade uncertainty may push RBA to turn more dovish
• UBS warns full tariffs could push US inflation to 5%
• Trump’s 54% tariffs bring China close to ‘worst case’ scenario, PBOC easing soon
• JPM: Tariff shock weighs on markets, but China and Hong Kong equities show resilience
• Japan Trade Minister Muto has spoken with US Commerce Secretary Lutnick
• China’s Commerce Ministry says will take countermeasures on Trump’s tariffs
• China Caixin Services PMI for March 2025 is 51.9 (prior 51.4)
• US Treasury Secretary Bessent warns other countries not to retaliate to US tariffs
• PBOC sets USD/ CNY reference rate for today at 7.1889 (vs. estimate at 7.2532)
• JP Morgan say Trump tariffs the largest tax increase since 1968 , US recession risk higher
• Japan Jibun / S&P Global Services PMI for March 50.0 (prior 53.7)
• Reserve Bank of Australia – Tariffs could have a chilling effect on business investment
• Australia trade balance for February is a surplus of AUD 2.968bn (vs. 5.6bn expected)
• PBOC is expected to set the USD/CNY reference rate at 7.2532 – Reuters estimate
• EUR risen strongly in Asia morning trade after Trump tariff announcement sell off earlier
• Deutsche Bank: there will be a straight-forward FX adjustment. Watch China’s next move
• Crypto takes another bath on Trump tariff tade war
• Trade ideas thread – Thursday, 3 April, insightful charts, technical analysis, ideas
• Fitch calculates US tariff rate on all imports is now 22%, up from 2.5% in 2024
• Canada will respond to the U.S. tariffs on Thursday, says PM Carney
• Recap (so far) – Trump trade war imposes sweeping new tariffs, 54% on China now
• US stock market slammed lower after Trump’s trade war tariff announcement
• Bessent: Trump might be to let things settle for awhile rather than negotiate tariffs
• The average US tariff rate might land around expectations
• Fed’s Kugler warns of prolonged impacts of tariffs on inflation
• Trump slams China with a 54% tariff rate
• Canadian dollar jumps as Canada exempted from new US tariffs
• European Union President von der Leyen to make a statement on US tariffs Thursday morning
• White House: Goods from Mexico and Canada that comply with the USMCA continue to be exempt
• US to impose 49% tariff on Vietnam
• Stock markets retreat as reciprocal tariffs sting
• Here’s the full list tariff war declaration
• Trump ‘auto’ tariffs will also include computers, laptops and desktops – report
• Its kiss your a** goodbye time for the global economy – massive tariff war declared
• Fed’s Kugler: Latest data indicate progress towards 2% inflation may have stalled
• Surge of buying into the USD, risk slapped back down, as Trump announces huge tariffs
• Trump tariff rates – more details – HUGE tariffs announced
• Trump says will sign reciprocal tariffs executive order
• Major US indices close higher ahead of Trump tariff news
• Forexlive Americas FX news wrap: Not many leaks in the final countdown to tariffs

Trump announced his latest trade policy,
introducing a series of tariffs aimed at addressing trade imbalances
and protecting domestic industries. ​

Key components of
the announcement include:

• Baseline Tariff: A
  universal 10% tariff will be imposed on all imported goods, effective
  April 5, 2025. ​
• Reciprocal Tariffs:
  Higher tariffs targeting specific countries (around 60 countries)
  perceived to have significant trade barriers against U.S. products
  will be implemented starting April 9, 2025.

Notable rates include:​

• China: 34%,
  increasing the total tariff to 54% when combined with existing
  duties.​
• European Union:
  20%.​
• Japan: 24%.​
• Vietnam: 46%.​
• India: 26%. ​

More:

• Auto Imports: A 25%
  tariff will be applied to all imported automobiles, aiming to bolster
  the U.S. automotive industry. ​
• De Minimis Rule
  Adjustment: The exemption for low-value packages (under $800) from
  China and Hong Kong will be eliminated, targeting e-commerce
  shipments that previously avoided tariffs. ​

The tariffs are set
to take effect in early April, with the baseline tariffs commencing
on April 5 and the reciprocal tariffs on April 9. ​

The abrupt tariff
hikes have heightened market volatility, with investors expressing
concerns about potential inflationary pressures and a slowdown in
global economic growth. Analysts warn that prolonged trade tensions
could lead to sustained market instability and dampened investor
confidence.

Most major FX was
slammed lower in the wake of Trump’s announcement of massive
increases in tariffs. The moves have been
pretty much retraced, FX recovering. EUR has done more than recover,
its up above 1.09 as I update.

• USD/JPY, though,
  lost ground from above 150.25 (early highs) to below 148.00 and that
  has continued. USD/JPY has hit lows circa 147.30 as the flight into yen
  carried through.

US equity index
futures were slammed lower upon the evening reopen for Globex. They’ve
since retraced. Asian equities:

• Japan: The Nikkei
  225 tumbled 3%, reaching an eight-month low, as investors reacted to
  the U.S.’s 24% tariff on Japanese goods. ​
• South Korea: The
  Kospi index declined by 1.5%, reflecting concerns over a 25% U.S.
  tariff on South Korean exports. ​
• Hong Kong: The Hang
  Seng Index fell 1.4%, with tech and manufacturing sectors hit hardest
  due to increased tariffs on Chinese goods

***

Yen rocketed:

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

European Commission President von der Leyen

• US tariffs are a major blow to the world economy
• The consequences will be dire for millions of people around the world

• All businesses will suffer

• There seems to be no order in the disorder
• Agrees with Trump that others are taking unfair advantage of the current rules
• EU has always been ready to negotiate with the US
• Preparing for further counter measures on US tariffs if negotiations fail
• We are ready to respond
• We are preparing further package of measures to protect our interests
• Many feel let down by our old ally

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

China will increase retail prices of gasoline and diesel starting Thursday, following recent rises in international crude oil prices, according to the National Development and Reform Commission (NDRC).

The price of gasoline will rise by 230 yuan (approximately USD 32) per tonne, while diesel will increase by 220 yuan per tonne.

The NDRC has called on major state-owned oil companies — including CNPC, Sinopec, and CNOOC — along with other refineries, to maintain steady production and ensure smooth distribution in order to support stable fuel supply.

Under China’s pricing system, domestic fuel prices are adjusted in line with global oil price movements.

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

UBS estimates that if the full slate of proposed tariffs is permanently implemented, U.S. inflation could rise to around 5%, as import costs filter through to consumer prices.

–

I guess if the Fed views the jump as ‘transitory’ they will cut on the growth scare factor.

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

Most major FX was slammed lower in the wake of Trump’s announcement of massive increases in tariffs.

The moves have been pretty much retraced, FX recovering. EUR has done more than recover, its up above 1.09 as I update.

USD/JPY, though, lost ground from above 150.25 (early highs) to below 148.00 and that has continued. USD/JPY has hit lows 147.60 as the flight into yen carried through.

USD/JPY update:

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

Japan Trade Minister Muto:

• Held online meeting with US Commerce Secretary.

• Told US Secretary new US tariffs would bring negative impact on US economy as well.

• Told US counterpart new tariffs announcement is “extremely regrettable.”

• Need to analyse content and examine impact on Japan economy.

• Will ask US strongly to exempt Japan from tariff measures.

• Will establish task force to provide information and grasp the impact.

• Share strong concerns whether US tariff measures are in line with WTO agreement.

• US Commerce Secretary asked me to look into the details of new tariff measures during our call.

• Told US counterpart tariff measures are not beneficial for both Japan and US.

• Will consider various options for what is best for Japan.

• Told us counterpart that tariff measures could discourage Japan companies’ US investment

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