Trade war fears between USA-EU
March 5, 2018
Europe Market Movements
Reaction to the Italian election results has been muted but the shift in Italy to anti-EU parties could rock the single currency, especially if those parties manage to form a coalition government. The week ahead promises to be busy for currency traders, with monetary policy meetings in Australia, Canada, the EU and Japan. Today keep an eye on the PMI data coming out in the EU. Germany and the UK.
US Market Movements
The markets remain jittery over the rhetoric from Washington and Brussels about a trade war. Trump will be signing an order imposing an import tariff on steel an aluminum. The EU has threatened with retaliation. Canada has expressed concern about the new tariffs and Trump is under pressure to exclude his northern neighbor. It remains to be seen how developments affect the USD, CAD and EUR.
Asia/Oceania Market Movements
The USDJPY has been falling, with the pair currently trading at 105.378, down from 106.809 on March 1, at the same time. The trend is on the downside but it remains to be seen how economic data today in both countries, affects the currency pair. Down in Australia, keep an eye on the RBA’s rate meeting tomorrow. Experts expect at least one rate hike this year. The markets will be listening closely, for hints on a monetary policy change.
Crude oil prices have been climbing, ahead of a meeting between OPEC and US shale producers today. The topic under discussion is how to reduce the global oil glut. Brent is up 0.68% at $64.81 a barrel and WRI rose by 67% at $61.66.
Asian markets have been trading lower today with the Nikkei 225 falling by 0.66%, the Topix by 0.79% and the Kospi by 1.13%. The Hang Seng has fallen by 1.42% and the Australian ASX 200 by 0.57%. It appears that the markets are taking a ‘wait and see’ attitude to the trade war rhetoric between Washington DC and the Europeans.
|09:00 GMT||EUR: Services PMI|
|09:30 GMT||GBP: Services PMI|
|15:00 GMT||USD: ISM Non-Manufacturing PMI|
|Tuesday March 6.
3:30 GMT +1
|AUD: RBA Rate Statement & Interest Rate Decision|