After easing fears around Fed independence and China tariffs, Trump’s renewed trade threats have shaken market confidence. The weak global PMI data for April and a cautious mood across major international financial institutions added to the dicey sentiment.
Against this backdrop, the US Dollar Index (DXY) lacks upside momentum after a two-day winning streak while Gold pauses its pullback from all-time high. That said, EURUSD and GBPUSD print the first daily gains in three, so far, while USDJPY fades recovery from a seven-month low. Meanwhile, AUDUSD and NZDUSD struggle to recover whereas USDCAD retreats amid softer crude oil prices. Moving on, cryptocurrencies also pare weekly gains despite upbeat industry news and the equities also lack upside momentum.
EURUSD rises for the first time in three days as the US Dollar weakens, despite EU-US trade jitters and mixed Eurozone data. Support also comes from China’s growing interest in Europe and talk of easing EU sanctions.
Meanwhile, USDJPY slips as the IMF backs Japan’s policies and trade tensions resurface. Although Trump’s tough stance on Japan limits further downside, policy divergence between the Fed and BoJ keeps pressure on the pair.
BoE Governor Bailey’s pushback against US trade pressure dents sentiment, but a softer Dollar and hopes of a BoE rate cut pause lift the Pound. GBPUSD posts its first gain in three days, reversing pullback from a recent seven-month high, though weak UK PMI data caps further upside.
A softer US Dollar lifts major currencies, but AUD, NZD, and CAD remain weighed down by US-China trade tensions, lower oil prices, and dovish central banks. Hints of the US easing China tariffs offer brief relief, though gains are limited ahead of key US data. Meanwhile, Washington’s tough stance on Canada challenges recent USDCAD weakness.
Gold edges higher after a two-day drop but lacks momentum amid mixed US-China trade news and caution ahead of US data. Still, market jitters and a weaker Dollar support XAU/USD as trade protectionism fears grow.
Meanwhile, Oil dips after a surprise rise in US inventories and pressure on OPEC+ to boost output. Concerns over China’s energy demand add to the drag, though a soft Dollar helps limit losses.
Bitcoin (BTCUSD) and Ethereum (ETHUSD) pull back from recent highs, trimming weekly gains amid renewed US-China trade tensions. The drop comes despite rising demand for BTC ETFs, a surge in TRUMP meme coins ahead of a key holder meeting, and Russia’s launch of a crypto exchange for select investors.
With US Durable Goods Orders and Jobless Claims, UK retail sales, IMF updates, and central bank speeches ahead, traders have plenty to watch. Still, focus remains on Trump’s take on China tariffs and trade talks with 90 countries. If the White House boosts sentiment and eases trade fears, the US Dollar could snap its four-week losing streak, pressuring EUR/USD, GBP/USD, and commodity currencies. Meanwhile, Gold and JPY may stay in demand, oil could remain weak, and crypto and stocks may hold gains—unless Trump shakes market confidence again.
May the trading luck be with you!
