Ipek Ozkardeskaya
Swissquote Bank Ltd
Yesterday offered a moment of relief for some investors amid the Trump euphoria sweeping through the markets. The nomination of Scott Bessent for Treasury Secretary resonated well across investment communities as the man – who runs a macro hedge fund and backs Trump’s tariffs and tax cuts – is seen a ‘measured choice’ for the economy and financial markets, as he would tame spending and adopt a ‘gradual’ approach to imposing tariffs.
But, wait. Investors didn’t have time to fully enjoy the news as Trump said that the US will impose extra 10% tariffs on Chinese goods and 25% levies on all products from Mexico and Canada. Mood in Asia was less cheery. The Mexican peso took a hit, and the USDCAD shortly rallied to 1.4180, hit by the falling oil prices as well, and traded at a level last seen in April 2020.
Elsewhere, US crude slipped below the $70pb level on rising hope of a cease-fire between Israel and Hezbollah, but nat gas futures remain under the positive pressure of tense setup with Russia.
Today, investors will lean on the FOMC minutes to find any hints of what the Federal Reserve (Fed) could do next.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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