As the North American trading session starts, the US dollar shows mixed performance while both US stocks and yields have risen. Optimism grew after Senate Democratic Leader Chuck Schumer supported a Republican funding bill to avert a government shutdown.
Trade tensions persist, with President Trump threatening a 200% tariff on European alcoholic beverages due to reciprocal tariffs on American whiskey, raising concerns about inflation and potential recession risks. Tariffs will start on April 2, affecting various sectors.
Euro Gains Support Amid Political Developments
In Europe, a debt agreement among Germany’s political parties has favoured the euro. The EURUSD dipped but rebounded above the 100-hour moving average.
Japan’s Rengo union reported a 5.46% wage hike for FY25, lower than the 6.09% target. The USDJPY rose to 149.01 but faced support between 148.56 and 148.77.
The GBPUSD is slightly down today. UK’s January GDP contracted by 0.1%, following a prior 0.4% increase, largely due to weaknesses in industrial and manufacturing sectors.
US indices are rebounding slightly after a poor previous day. The Dow fell 1.30%, while in premarket trading, it rose by 240.43 points.
Market Trends In Commodities And Cryptocurrencies
Yields in the US have increased, with the 2-year at 3.975% and the 10-year at 4.314%. European indices also improved, with Germany’s DAX up 1.91%.
Crude oil prices have risen to $67.06, and gold is up to $2998.95. Bitcoin has increased to $83,421.
The opening of the North American trading session has brought a mixed performance for the dollar, with attention divided between stock market movements and shifting bond yields. Equities in the United States have edged higher, with government borrowing costs following suit. A fresh sense of optimism has emerged after Schumer threw his support behind a Republican-backed plan to maintain government funding, easing fears of an imminent disruption.
Elsewhere, trade disputes remain unresolved. Washington has announced plans to impose a steep duty on certain European spirits in response to levies placed on American whiskey. With this measure taking effect in early April, industries on both sides may feel the strain. Price pressures could grow if costs are pushed onto consumers, and the broader economy may face headwinds.
Over in Europe, political developments have provided some support for the single currency. A breakthrough on Germany’s fiscal policies has helped sentiment, leading to a rebound after earlier declines. The common currency slipped but recovered after finding support at a closely watched technical level.
Shifting to Asia, wage data out of Japan has drawn attention. Rengo’s latest figures point to a pay rise that, while noticeable, fell short of its intended target. The yen weakened, with the dollar gaining ground towards the 149 level before meeting resistance in a defined range. Traders seem to be weighing whether this trend has room to extend beyond that zone.
Across the Channel, Britain’s economy remains fragile. The latest reading of gross domestic product showed a mild pullback, following a period of modest recovery. The most recent contraction appears tied to declines in industrial activity and manufacturing, which have struggled to regain momentum. The pound has edged lower, with market participants digesting what this means for rate expectations.
Meanwhile, US equity markets are attempting to bounce after a challenging session. The Dow suffered a steep drop, but early trading suggests that some appetite for risk has returned. Bond yields have also risen again, with shorter-term and longer-term borrowing costs both moving upward. A similar pattern has emerged across the Atlantic, where Germany’s benchmark index has posted gains.
Commodities are on the move as well. Crude oil now trades above $67, while gold prices have climbed further, nearing the $3,000 mark. Digital assets continue to rally, with Bitcoin extending its advance beyond $83,000.
