- The European Central Bank will be holding its first policy meeting today in the shadow of the new tariffs which President Trump announced earlier this month, and ones that he also announced but paused for 90 days. Fear of the effect of such new tariffs has helped create a more suitable environment for rate cuts, which has increased the chance that the Bank will cut by 0.25%. The EUR/USD currency pair is in a bullish long-term trend and has been one of the major gainers since the new tariffs were announced, but the price is currently falling off the new 5-month high recently made above $1.1400. Trend traders will still be positioned long here.
- The other standout asset today is the precious metal Gold, which has continued its strong advance (up by approximately 10% in just a few days) some hours ago to reach a new record high above $3,350. Gold has been moving up for more than 15 months and trend traders are very attracted to being positioned long here in line with this trend which has gained renewed momentum over the past few week.
- Stock markets are mostly higher over today's Asian session, boosted by President Trump's statements confirming that a first round of trade / tariff negotiations between the USA and Japan went well. The Japanese Nikkei 225 Index is up by 1.35% today.
- In the Forex market, since today's Tokyo open, the strongest major currency is the British Pound, while the weakest is the New Zealand Dollar. However, the major news here is the strong long-term trend in both the two major currency pairs, the EUR/USD and the USD/JPY, with the latter reaching a new 7-month low price earlier today at 141.60, so the prevailing sentiment seems a bit unclear as the London session gets underway - probably this is more tariff concerns than simple risk-off. We have also seen the US Dollar Index seem to invalidate key support, pointing a technical path towards a further decline in value.
- New Zealand inflation data came in higher than expected, unexpectedly rising from an annualized rate of 2.2% to 2.5%,, but this is not seen as ruling out a further rate cut in foreseeable future by the Reserve Bank of New Zealand due to the general weakness of the Kiwi as a factor.
- Bitcoin has remained subdued, held down for another day by the key resistance level at $86,215.
- US Retail Sales data released yesterday showed a jump, which is widely interpreted as caused by a rush to beat new tariffs.
- Fed Chair Jerome Powell spoke publicly yesterday, saying that the labor market is key to price stability.
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