As the week begins, the market sentiment improves amid ongoing analysis of the US-China trade conflict. The economic calendar for Monday lacks any major data releases, though several Federal Reserve officials are scheduled to speak.
In the last week, the US Dollar was the weakest among major currencies, particularly against the New Zealand Dollar. The USD/JPY remains under pressure, trading near 142.50 as Japan reports less-than-expected industrial production growth for February.
us government tech import exemptions
The US government has granted exemptions on certain tech imports such as smartphones, which will not face the additional 125% tariffs. Meanwhile, US stock index futures rose significantly on Monday, with Nasdaq Futures seeing a 1.7% increase.
The USD Index has declined about 3%, reaching its lowest since April 2022. The index is in negative territory below 99.30, reflecting a broader decline against major currencies.
China’s trade data showed a surplus decline to $102.64 billion in March, with exports growing and imports decreasing. The AUD/USD continues its upward trend, while GBP/USD maintains its strength above 1.3150.
Gold saw a 6% rise last week, briefly reaching a new high of $3,245. Despite a dip, it remains near $3,230. EUR/USD holds strong near 1.1400 after a notable previous week increase.
importance of fed speeches
The earlier part of the article suggests that risk sentiment has shifted slightly more positively as we step into the new trading week, especially with market participants carefully watching developments in international trade. Notably, the economic schedule for Monday is sparse, which has typically given more weight to other indicators—such as monetary policy signals from central bank officials. A day devoid of scheduled data can sometimes exaggerate the market’s sensitivity to external commentary or geopolitical events.
The sharp weakening of the US Dollar last week came as a surprise to some, especially when seen alongside strength in risk-linked currencies like the New Zealand Dollar. Against the Yen, however, the Dollar continues to see weakness, floating near 142.50. One could easily chalk this up to softer figures on Japanese industrial output, but that metric alone lacks the energy to move FX pairs too far on its own. We suspect broader cross currents—such as shifts in Treasury yields—may be playing a more persuasive role here.
New developments from Washington have also played their part. By sidestepping broader tech import tariffs, the US government has opted to soften the edge of their trade stance. Smartphones and other electronics will not bear additional levies of 125%, a move likely designed to avoid pressure on domestic tech retailers and consumer demand. That alone appears to have buoyed sentiment in equity futures early in the week, with Nasdaq Futures leading the push upwards by climbing 1.7%.
Not all parts of the Dollar’s weakness can be explained by trade. The USD Index, now below 99.30, has dropped 3% and is trading at the lowest level in nearly two years. It’s the persistence of this move that matters more than the size. We’re seeing broader selling pressure against most other major currencies, suggesting a rebalancing of expectations around further Fed policy shifts or prospective inflation trajectories. If we look to the bond markets, they offer some clues—yields on longer maturities have slipped slightly, enhancing the appeal of non-dollar assets.
From the Asian side, China’s March data showed a narrowing of the trade surplus to just over $102 billion. Exports ticked up, while imports dipped. That split tells us domestic demand hasn’t yet recovered as strongly as external demand has. The Aussie Dollar has used that external data to support a continuation of its mild ascent. It trades better when there are firm signs of industrial activity abroad, and China’s numbers—imperfect as they may be—provided a modest tailwind.
Sterling remains comfortably firm above 1.3150, with the Euro also standing solid near 1.1400. There hasn’t been any dramatic divergence in UK or Eurozone data lately, but the Dollar’s weakness has allowed both currencies some breathing space. In technical terms, both pairs are pressing against prior resistance levels, and we are monitoring closely for any breaks higher or pace reversals based on policy expectations.
Gold’s impressive 6% gain last week took it briefly above $3,245 before settling near $3,230. Those moves have less to do with safe-haven flows and more with the broad decline in yield-adjusted returns on Dollar-denominated assets. The metal retains long-standing sensitivity to real rates, and with inflation showing mixed signs of slowing, the allure remains. This will be essential in shaping near-term sentiment across metals and potentially filtering into medium-duration Treasury futures.
Right now, we’re carefully watching liquidity patterns, particularly ahead of upcoming Fed speeches. When markets get guidance without data, volatility can surge in surprising places. These days, derivatives traders have needed to be more nimble, as central banks remain neither predictable nor entirely united in tone.
