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Hello everyone, today XM Foreign Exchange will bring you "[XM Group]: The dollar weakens, Trump plans new tariff moves to ignite safe-haven! Gold prices soar at $45 to a record high." Hope it will be helpful to you! The original content is as follows:
On April 16, during the trading session of the Asian market on Wednesday, the US dollar index hovered below 100, and spot gold soared, hitting a new high of 3,275 US dollars. Bloomberg reported on Wednesday that gold prices hit record highs as the Trump administration advanced an investigation into potentially expanding the trade war, spurring demand for safe-haven assets. U.S. President Trump launched an investigation into the necessity of key mineral tariffs on Tuesday local time, the latest move to the expanding trade war.
The executive order signed by Trump on Tuesday requires the Secretary of Commerce to initiate a Section 232 investigation under the Trade Expansion Act of 1962 to "evaluate the impact of imports of these materials on U.S. security and resilience."
Jim Wyckoff, senior analyst at KitcoMetals, said: "Traders are waiting for the next major fundamental development that drives the gold market, but the technical charts are still bullish. There is still a demand for hedging in the market." Gold is a safe-haven asset in a period of political and financial uncertainty.
Australia's Westpac leading index fell from 0.9% to 0.6%. Westpac pointed out that the index has just begun to reflect the escalating damage caused by U.S. President Donald Trump's announcement of reciprocal tariffs on April 2.
While the immediate impact on Australia is currently considered limited and controllable, “the pulse of growth may weaken further in the coming months”.
Western Pacific has lowered Australia's growth forecast for 2025 from 2.2% to 1.9%, the reason is that downside risks continue to accumulate.
Looking ahead with the RBA meeting from May 19 to 20, Westpac expects more obvious signs of worsening global background and cooling inflation to prompt the RBA to cut interest rates by 25 basis points.
In addition, the tone of the meeting may shift more decisively toward “the shift from lingering inflation problems to the downside risks of growth.” This change will lay the foundation for further easing of policies in the second half of the year.
Bank of Japan Governor Kazuo Ueda warned that U.S. President Donald Trump's escalating tariff policies are "close to the bad situation expected by the central bank."
"We will examine the extent to which U.S. tariffs will harm the economy without preconceptions," he said in an interview with Sankei Shimbun.
"Policy responses may become necessary. We will make appropriate decisions based on changes in the developments," he added.
Nevertheless, Ueda reiterated that the Bank of Japan will continue to raise interest rates “at the right pace” as long as the economic and price conditions are consistent with its forecasts.
In terms of inflation, Ueda said that domestic food price pressure is expected to ease. He believes that real wages turn positive and continue to rise in the second half of the year, thus supporting consumption and price stability.
Nevertheless, he warned of the dual risks: continued inflation caused by global supply shocks, or consumption drags caused by rising cost of living.
Investors' confidence in Germany deteriorated sharply in April, with the ZEW economic prosperity index plummeting from 51.6 to -14, the biggest drop since the outbreak of the Russian-Ukrainian war in 2022.
This decline was well below the expected 10.6, reflecting growing concerns about U.S. trade policy, which ZEW President Achim Wambach described as "an unstable change." However, the status quo index showed a slight improvement, rising from -87.6 to -81.2, slightly better than expected.
Investor sentiment in the euro zone also deteriorated significantly, with the ZEW expectation index falling from 19.8 to -18.5, down from 14.2. The current situation index fell -5.7 points to -50.9.
Events most vulnerable to trade disruptions, such as automobiles, chemicals and engineering, are now facing new pressure despite recent signs of stabilization, according to ZEW. The growing unpredictability of global trade dynamics puts heavy pressure on future expectations and weakens the optimism across the EU.
Despite market sentiment, financial market participants do not expect inflation to surge again. ZEW noted that this perception provides some room for the ECB to continue its easing cycle to support growth.
Eurozone's industrial production grew by 1.1% month-on-month in February, stronger than expected and far higher than the forecast of 0.1%. This growth was mainly due to a 2.8% increase in consumer goods non-durable goods and a steady growth in capital goods output by 0.8%. Intermediate products also rose slightly by 0.3%, while energy production and durable consumptionThe products decreased by -0.2% and 0.3% respectively.
Over the entire EU, industrial production increased by 1.0% month-on-month, with Ireland (+10.8%), Belgium (+7.4%) and Luxembourg (+6.3%) leading the gains. Meanwhile, Croatia (-3.9%), Greece (-3.6%) and Romania (-2.1%) saw the biggest declines.
The number of employment in the UK fell by 78k in March, down 0.3% month-on-month. The median monthly salary growth also slowed from 5.5% year-on-year to 4.8%, indicating that wage pressure has eased. Meanwhile, the number of applicants increased by 18.7k, lower than expected 30.3k growth.
In the three months to February, the unemployment rate stabilized at 4.4%, in line with expectations. Wage growth was slightly lower than expected across the board. Average revenue, including bonuses, rose 5.6% year-on-year (also on the previous month), while average revenue excluding bonuses increased 5.9%, slightly lower than expected 6.0%.
The number of employment in the UK fell by 78k in March, down 0.3% month-on-month. The median monthly salary growth also slowed from 5.5% year-on-year to 4.8%, indicating that wage pressure has eased. Meanwhile, the number of applicants increased by 18.7k, lower than expected 30.3k growth.
In the three months to February, the unemployment rate stabilized at 4.4%, in line with expectations. Wage growth was slightly lower than expected across the board. Average revenue, including bonuses, rose 5.6% year-on-year (also on the previous month), while average revenue excluding bonuses increased 5.9%, slightly lower than expected 6.0%.
The overall inflation in Canada in March exceeded expectations, and the annual CPI rate dropped from 2.6% year-on-year to 2.3%, which was lower than market expectations and there was no change. The slowdown was mainly due to the decline in tourism-related services and gasoline prices. Monthly calculation, CPI rose 0.3% month-on-month, lower than expected, 0.7% month-on-month.
Core inflation indicators also point to easing. The median CPI was stable at an annual rate of 2.9%, in line with expectations. However, the cut-off average fell from 2.9% year-on-year to 2.8%, and the common core fell from 2.5% year-on-year to 2.3%, both lower than expected.
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