Quick Facts
The financial markets are bracing for a potentially volatile day of trading as market participants await the unveiling of new US tariffs set to take effect on Wednesday.
Trump Tariffs Decision Dominates Forex Market Ahead of April 2 Announcement
The lack of clarity on the tariffs has left investors on edge, leading to a mixed bag of performance across the major assets.
Gold Slips Off Record High
Yesterday’s record high for gold prices was short-lived, as the precious metal fell victim to the uncertainty surrounding the tariffs. With investors seeking shelter in safer assets, gold plunged 1.3% to settle at $1,615 per ounce.
ADP Non-Farm Employment Forecast Uncertainty Lingers
In other news, the highly anticipated ADP non-farm employment report is set to be released later today. Market analysts are eagerly awaiting the numbers, which could provide crucial insight into the health of the labor market.
Trump Tariffs: The Unseen Force
As the market awaits the official announcement of the new tariffs, speculation is running rampant. The uncertainty surrounding the tariffs has led to a series of wild swings in the markets, with some suggesting that the move could have far-reaching implications for the global economy.
Impact on Major Assets
The potential impact of the tariffs on major assets is significant. For example, a 20% tariff on steel imports could lead to a rise in production costs for companies across various sectors, including automotive, construction, and manufacturing.
Currencies in the Crossfire
Both the US dollar and the euro are likely to remain under pressure, as the tariffs create uncertainty and weigh on investor sentiment. The Canadian dollar, on the other hand, may benefit from the tariffs, given its strong ties to the global economy and its natural resources sector.
Bond Market Anticipation
The bond market is also set to be impacted by the tariffs, as investors seek refuge in government bonds and other high-quality debt instruments. The 10-year US Treasury bond yield, which has been trending lower in recent weeks, may continue to decline as investors seek safety.
