Continued Trade Tensions Steer Markets: April 15, 2025

Continued Trade Tensions Steer Markets: April 15, 2025

Moneta Markets Daily Global Market Update:

Global financial markets are navigating a complex landscape on April 15, 2025, as US President Donald Trump’s tariff exemptions on tech and auto sectors spark a cautious risk-on sentiment, while escalating US-China trade tensions—marked by China’s 125% retaliatory tariffs against the US’s 145% duties—fuel recession fears. Investors are closely monitoring upcoming US PPI data, UK jobs figures, and Fed Chair Jerome Powell’s speech tomorrow for directional cues, with safe-haven assets like gold and the Japanese Yen holding firm amid uncertainty. The Pound and Australian Dollar are capitalizing on a weaker US Dollar, driven by expectations of Federal Reserve rate cuts, while oil prices grapple with mixed demand signals.

GBP/USD Hits Six-Month High

Current Level: GBP/USD surges past 1.3200, reaching its highest point since October 2024, marking six consecutive days of gains.

Driving Factors: A weakening US Dollar, pressured by US-China trade war fallout and stagflation concerns, bolsters the Pound. Divergent expectations—reduced odds of a Bank of England (BoE) rate cut versus anticipated Fed easing (90 basis points by year-end)—support the pair.

What to Watch: UK jobs data today could reinforce GBP strength if strong, with resistance at 1.3250 in focus.

 AUD/USD Rides Tariff Relief Wave

Current Level: AUD/USD extends its rally for a fifth day, trading near 0.6350, buoyed by improved global risk appetite.

Key Drivers: Trump’s exemptions on tech products like smartphones and semiconductors, many sourced from China, ease pressure on Australia’s top trading partner. RBA minutes highlight uncertainty on rate moves, keeping markets cautious.

Technical Outlook: Support at 0.6300 holds, with upside potential toward 0.6408 if risk sentiment persists.

 EUR/USD Stabilizes Amid Uncertainty

Current Level: EUR/USD hovers near 1.1350, caught between a stabilizing US Dollar and trade war jitters.

Influencing Factors: Atlanta Fed President Raphael Bostic’s remarks on persistent inflation challenges temper rate-cut hopes. The ECB is expected to cut rates by 25 basis points on Thursday, capping euro gains. US-China tariff escalation adds economic concerns.

Key Levels: Support at 1.1300; resistance at 1.1400. US PPI data today could drive volatility.

 Japanese Yen Trims Losses

Current Level: USD/JPY trades above 143.00, with the Yen recovering some ground after early losses.

Market Dynamics: Hopes for a US-Japan trade deal and rising Japanese inflation support the Yen, offsetting reduced safe-haven demand from an upbeat market mood. A dovish Fed outlook contrasts with potential BoJ tightening, capping USD/JPY gains.

Levels to Watch: Support at 142.50; resistance at 144.00. Trade-related headlines remain critical.

 Gold Shines as Safe-Haven Demand Persists

Current Level: Gold (XAU/USD) holds above $3,200, close to its all-time high, after a modest dip yesterday.

Supporting Factors: Intensifying US-China trade tensions drive safe-haven flows. Fed rate-cut bets weaken the USD, boosting gold. Trump’s tariff relief on tech and auto sectors slightly curbs upside momentum.

Technical View: Support at $3,167 is pivotal, with bulls targeting a retest of $3,246.

 WTI Oil Steadies on Mixed Signals

Current Level: WTI crude oil stabilizes around $61.10, supported by tariff relief hopes.

Key Influences: Trump’s hints at auto sector exemptions and prior tech tariff relief lift sentiment. China’s 5% year-over-year surge in March oil imports supports prices. However, OPEC+’s lowered demand forecasts for 2025 (1.3 million bpd) and 2026 (1.28 million bpd) limit gains.

Outlook: Resistance at $62.00; support at $60.00. Geopolitical developments could spur volatility.

 Broader Market Context

Markets are balancing optimism from US tariff exemptions against fears of a deepening US-China trade war. GBP/USD and AUD/USD thrive on USD weakness, while gold and the Yen draw safe-haven interest. EUR/USD remains range-bound, awaiting ECB cues, and WTI oil navigates conflicting signals. Today’s US PPI and UK jobs data, alongside Powell’s speech tomorrow, could shape near-term trends. Investors stay vigilant as trade policy uncertainty dominates.

Stay tuned for further updates as these dynamics evolve.