Market Roundup
•US Redbook (YoY) 7.2% ,4.8% previous
•Canada Ivey PMI n.s.a (Mar) 55.6 ,53.6 previous
•Canada Ivey PMI (Mar) 51.3 ,53.2 forecast, 55.3 previous
•US 3-Years Note Auction 3.784%, 3.908% previous
Looking Ahead Economic Data(GMT)
• 01:30 Australia Building Approvals (MoM) (Feb) -0.3% forecast, 6.9% previous
• 01:30 Australia Private House Approvals (Feb) 1.0% forecast, 1.1% previous
•02:00 New Zealand RBNZ Interest Rate Decision 3.50% forecast, 3.75% previous
• 05:00 Japan Household Confidence (Mar) 34.7 forecast, 35.0 previous
Looking Ahead Events And other Releases(GMT)
•02:00 New Zealand RBNZ Rate Statements
• 06:15 Japan BOJ Gov Ueda Speaks
Currency Forecast
EUR/USD: The euro rose on Tuesday following reports that German political parties had agreed to form a coalition, while the U.S. dollar weakened against major currencies and China's offshore yuan hit a record low.Germany's conservatives, led by chancellor-in-waiting Friedrich Merz, were said to have reached an agreement with the center-left Social Democrats (SPD) to form a government, according to NTV. However, two sources with knowledge of the situation told Reuters that no deal had been finalized.Investors have remained focused on the trade disputes triggered by President Donald Trump's sweeping tariffs, which have caused market volatility for the past three days.The euro gained 0.52%, reaching $1.0958 after falling for the previous two days. Immediate resistance can be seen at 1.1000(Psychological level), an upside break can trigger rise towards 1.1168(23.6%fib).On the downside, immediate support is seen at 1.0856(50%fib), a break below could take the pair towards 1.0783(April 2nd low).
GBP/USD: The British pound strengthened against the U.S. dollar on Tuesday as investors sought signs of relief amid the ongoing global trade war. Optimism grew as countries like Japan, the UK, Europe, and Israel showed interest in negotiating trade deals with the U.S., boosting risk appetite. British Prime Minister Keir Starmer remarked on Monday that his government’s initial response to higher U.S. tariffs should not include relaxing public borrowing rules. On the same day, the European Commission proposed a zero-for-zero tariff deal, with EU ministers prioritizing negotiations to avert a trade war. Sterling was last up 0.10% against the dollar at $1.2777, having slid around 1.4% from where it was before Trump unveiled his tariffs on April 2. Immediate resistance can be seen at 1.2979(38.2%fib), an upside break can trigger rise towards 1.3165(23.6%fib).On the downside, immediate support is seen at 1.2812(50%fib), a break below could take the pair towards 1.2686(March 4th low).
USD/CAD: The Canadian dollar strengthened against the U.S. dollar on Tuesday as investors weighed the possibility of global negotiations over U.S. trade tariffs and the potential return of Canadian investment flows from abroad. Canada managed to avoid new tariffs on its goods last week as the U.S. announced a 10% baseline tariff on all imports and higher duties on several major trading partners. The tariff exemption for goods compliant with the USMCA trade agreement between the U.S., Mexico, and Canada has helped the Canadian dollar outperform some major currencies, according to Mirza Baig, a foreign exchange strategist at Desjardins. Meanwhile, Canadian economic activity slowed in March, with the Ivey Purchasing Managers Index (PMI) data showing a decline. The seasonally adjusted index dropped to 51.3 from 55.3 in February, reflecting a slowdown in employment and rising prices.Immediate resistance can be seen at 1.4295 (38.2%fib), an upside break can trigger rise towards 1.4418 (April1st high).On the downside, immediate support is seen at 1.4159(50%fib), a break below could take the pair towards 1.4024 (61.8%fib)
USD/JPY: The dollar dipped against the Japanese yen on Tuesday as ongoing trade-related uncertainty continued to boost demand for the safe-haven yen. Last week, President Trump announced a 10% baseline tariff on all imports to the U.S., along with higher duties on several other countries, including key U.S. trading partners. This move shook global markets and left U.S. allies bewildered. Trump also mentioned that Japan would send a delegation to discuss trade after speaking with Japanese Prime Minister Shigeru Ishiba earlier on Monday. During their call, the Japanese Prime Minister expressed deep disappointment with the tariff policies and urged Trump to reconsider. Trump's decision to impose a 25% tariff on auto imports and a 24% reciprocal tariff on other Japanese goods is expected to severely impact Japan's export-driven economy. Immediate resistance can be seen at 148.40(Daily high) an upside break can trigger rise towards 147.42(50%fib). On the downside, immediate support is seen at 145.28(38.2%fib) a break below could take the pair towards 144.00(Psychological level).
Equities Recap
European shares rebounded from 14-month lows on Tuesday, following four consecutive sessions of heavy selling. However, investors remained cautious, closely monitoring developments as countries responded to the sweeping U.S. tariffs.
UK's benchmark FTSE 100 closed up by 2.71percent, Germany's Dax ended upby 2.48 percent, France’s CAC finished the day up by 2.50 percent.
The S&P 500 closed below 5,000 points for the first time in nearly a year, reversing an earlier rally. Investor optimism faded as hopes for any immediate U.S. delays or concessions on tariffs diminished ahead of the midnight deadline.
Dow Jones closed down by 0.84 %percent, S&P 500 closed down by 1.47% percent, Nasdaq settled down by 2.15% percent.
Commodities Recap
Gold trimmed earlier gains on Tuesday as U.S. Treasury yields climbed, but a weaker dollar and escalating trade tensions between the U.S. and China helped support prices.
After rising as much as 1.3% earlier in the session, spot gold was up 0.1% at $2,984.16 an ounce by 2:03 p.m. ET (1803 GMT). U.S. gold futures settled 0.5% higher at $2,990.20.
Oil prices fell by more than $1 a barrel on Tuesday, reaching a four-year low, as investors anticipated a higher risk of recession amid the escalating trade war between the U.S. and China, the world's two largest economies.
Brent futures settled down $1.39, or 2.16%, at $62.82 a barrel. U.S. West Texas Intermediate crude futures settled down $1.12, or 1.85%, at $59.58.
