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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Market Analysis]: Trump's attack on Powell hit market confidence, and gold prices continue to hit a record high of 3450, which is close to you." Hope it will be helpful to you! The original content is as follows:
On Tuesday (April 22 Beijing time), spot gold continued to rise, setting a record high to 3441.53. The weakening of the dollar and the uncertainty of the economic impact of trade tensions stimulated safe-haven demand. Trump's attack on Powell may threaten the independence of the Federal Reserve, hitting investors' confidence in the U.S. economy again; U.S. crude oil rose, trading around $62.87 per barrel, and oil prices fell more than 2% on Monday as signs of progress in negotiations between the United States and Iran, while investors are still worried that the obstacles brought by tariffs to the economy may curb fuel demand.
U.S. stocks fell sharply on Monday, as U.S. President Trump stepped up his criticism of Fed Chairman Powell, which has raised concerns about the Fed's independence, which they are already dealing with the impact of Trump's ongoing and capricious trade war.
The three major stock indexes all fell by more than 2%, and the large growth stocks of "Seven Technology Heroes" suffered heavy losses, causing the biggest drag on the Nasdaq Index, a major technology stock market.
The S&P 500 closed at 16% below its record closing high on June 19. If the decline reaches 20%, it will be confirmed that the index has entered a bear market.
Trump increased his criticism of Powell on Monday, saying the U.S. economy was about to slow down, "unless it was too late, the big loser, lowered interest rates now." His fierce speech on TruthSocial, raising concerns about the independence of the Federal Reserve.
Jed Elle, Portfolio Manager, ArgentCapitalManagement"Countries with independent central banks have faster economic growth, lower inflation, and better economic life for people. It is really a bad idea for politicians to try to influence the Fed, which is very scary for the market."
Ellerbroek added that companies are not sure how to deal with it, waiting for the final answer to the tariff rate of the United States, and I think it's frustrating that it's like taking it upon themselves; we're in this situation out of voluntary choice, the choice of this administration.
The Dow Jones Industrial Average fell 2.48% to 38,170.41 points; the S&P 500 fell 2.36% to 5,158.20 points; and the Nasdaq fell 2.55% to 15,870.90 points.
All 11 major sectors of the S&P 500 closed lower, with consumer discretionary and technology sectors falling the most.
The first quarter financial report season will reach its climax this week, with dozens of highly-watched companies reporting financial reports. Data from the London Stock Exchange Group (LSEG) shows that 68% of the 59 companies that have released their financial reports exceeded Wall Street expectations.
Analysts expect S&P 500 companies' overall earnings in the first quarter to rise 8.1% year-on-year, down from the 12.2% forecast at the beginning of the quarter, according to LSEG data.
The financial reports worth paying attention to this week include Tesla and Alphabet, members of the "Seven Tech Heroes", as well as a series of highly-watched industrial companies, including Boeing, Northrop Graman, Lockheed Martin and 3M.
Nvidia, a major artificial intelligence stock, fell 4.5%, and Tesla fell 5.8%, after Reuters reported that the production time of its low-end Model Y was postponed.
Gold prices rose above $3,400 on Monday, as weaker dollar and uncertainty over the economic impact of trade tensions stimulated safe-haven demand. Spot gold continued to rise, setting a record high of 3441.53.
The dollar fell to its lowest level in three years, and President Trump's comments on Federal Reserve Chairman Powell once again hit investors' confidence in the U.S. economy.
David Meger, director of metal trading at HighRidge Futures, said: "As tariff tensions continue to heat up, we continue to believe that gold prices will rise as a safe-haven reaction. There will be corrections and profit-taking, but we still believe the basic trend is sideways to higher."
Spot silver remained stable at $32.60 per ounce, platinum fell 0.6% to $961.61 and palladium fell 3% to $934.25. Oil market
Oil prices fell more than 2% on Monday as signs of progress in negotiations between the United States and Iran, while investors remain worried that the economic obstacles brought by tariffs could curb fuel demand.
Brent crude oil futures fell $1.70, the settlement price was $66.26 per barrel, down 2.5%, and the settlement price rose 3.2% last Thursday, as Friday coincided with the Good Friday holiday, and the last settlement day last week was Thursday.
U.S. crude oil futures fell $1.60, and the settlement price was $63.08 per barrel, a drop of 2.5%, up 3.54% on the previous trading day.
Harry Tchilinguirian, head of research at Onyx Capital Group, said: "The US-Iran negotiations look relatively positive, which has led people to think about the possibility of the problem being solved, and the direct impact is that Iranian crude oil will not exit the market." He added that due to the Easter holiday, the market liquidity is also low, which may exacerbate price volatility. The Iranian foreign minister said that during the talks, the United States and Iran agreed to start developing a possible nuclear agreement framework, and a U.S. official said the talks had made "very good progress."
A Reuters survey on April 17 showed that investors believe tariffs will lead to a sharp slowdown in the U.S. economy this year and next two years, with the median probability of falling into recession in the next 12 months approaching 50%.
Investors are paying attention to several data to be released this week in the U.S., including the initial value of the manufacturing and service industry Purchasing Managers Index (PMI) in April to see where the economy is going.
The dollar fell to its lowest level in three years on Monday as U.S. President Trump's attack on Powell could threaten the Fed's independence and put investors' confidence in the U.S. economy on another blow.
Trump increased his criticism of Fed Chairman Powell via social media on Monday, calling him a "big loser" and demanding him cut interest rates immediately.
The dollar fell to a low of 97.923 against a basket of currencies, the lowest since March 2022, with the dollar falling to a 10-year low against the Swiss franc, while the euro rose above $1.15.
The U.S. National Economic Commission Director Kevin Hassett said Friday that the president and his team are continuing to study whether Powell can be removed. Just the day before, Trump said that the "faster the better" of Powell and called on the Fed to cut interest rates.
On Monday, most European and Australian markets were closed on Easter Monday, and trading was light. Last Friday, most markets around the world were closed due to holidays.
After Trump posted a post about Powell on social media, the U.S. stock market fell sharply on Monday, with all three major stock indexes falling by more than 2%, among which the "Seven Tech Heroes" fell the most, bringing the biggest drag on the Nasdaq index, which is dominated by technology stocks.
Vishnu Varathan, head of macro research at Mizuho Asia (except Japan), said, "Powell does not report directly to Trump, so (Trump) can't actually fire him. Powell can only be removed through certain procedures, and the threshold for these procedures may be higher, but the president can use various means to destroy the Federal Reserve.Is it independence? sure. ”
The dollar fell more than 1.5% against the Swiss franc to a 10-year low of 0.8063, while the euro hit a high of $1.1535, the highest since November 2021.
The dollar also fell to a seven-month low against the yen, with the latest hitting a record high in the week ending April 15, according to the U.S. Commodity Futures Trading Commission (CFTC) data showed that the yen net long positions hit an all-time high.
Karl Schamotta, chief market strategist at Corpay in Toronto, said in a research note, “If the Fed’s dual mission – keeping prices stable and promoting full employment – is weakened by a series of new goals set by the White House, policy makers may find themselves unable to tighten their policies significantly in the context of sudden price increases. ”
The pound rose to its highest since September of $1.34, while the Australian dollar hit a four-month high of $0.6430. The New York dollar recovered the $0.6000 level for the first time in more than five months.
The uncertainty of Trump's comprehensive tariffs and its trade policy has caused global markets to chaotic and bleak outlook for the world's largest economy, which in turn led to the weakening of the dollar as investors divest from U.S. assets.
According to the analysis report of the Atlanta Fed, the broad-subject labor in the U.S. federal government (including employees of contract workers and funded projects) may decrease by more than 1.2 million. This forecast mainly reflects the shrinking scale of the government's indirect employment of personnel through contracts and funded projects. Atlanta Fed Fed researcher M. Melinda Pitts "Given the large size of the federal labor force, this decline in employment may have a significant impact on the labor market." In order to reduce government spending and fiscal waste, President Trump has launched a national plan for streamlining federal agencies. Pitts' research found that the total federal broad labor force, including contract workers and project employees, may be reduced by up to 1.2 million by combining measures such as freezing recruitment, voluntary buyout of service and early retirement.
On the 21st local time, the World Economic Forum issued a statement saying that its founder, Klaus Schwab, has resigned as chairman of the forum board of directors. The statement said that the World Economic Forum board of directors had accepted Schwab's resignation at a special meeting held on the 20th. Schwab said: "I decided to resign from the positions of chairman of the board of directors and members of the board of directors, and the decision will take effect immediately. "The statement also said that the committee responsible for appointing the new chairman has been established. Before the new chairman takes office, the forum's vice chairman Peter Baubida will serve as interim chairman.
Source revealed that tariff concerns spread, US President TrumpRepresentatives of major retail companies including Walmart, Home Depot, Lowe's and Target will be held to discuss the impact of the full tariff on their business.
People familiar with the matter said the United States may hold talks with Ukrainian and European officials in London on Wednesday, and Trump is pushing for an agreement to stop the Russian-Ukrainian conflict. U.S. Secretary of State Rubio, Trump's envoy Witkov and Keith Kellogg are expected to meet with foreign ministers and national security advisers in France, Germany, the United Kingdom and Ukraine, people familiar with the matter said. They said the negotiation plan is being finalized and there is still a possibility of change. The meeting is a follow-up to a meeting held in Paris last week. At the Paris meeting, the United States shared its proposals to facilitate a ceasefire and peace agreement between Russia and Ukraine. It was previously reported that the United States was preparing to relax sanctions on Moscow as part of the agreement and recognized Russia's control over Crimea, the Black Sea Peninsula of Ukraine.
Senior manager of the Chamber of Commerce Justyna Zabinska-LaMonica said: "U.S. economic growth indicators in March indicate that economic activity will slow in the future." "The decline in March focused on three sub-indicators that weakened due to rising economic uncertainty ahead of tariff announcements: 1) further decline in consumer expectations; 2) Stock prices hit their biggest monthly decline since September 2022; 3) New orders in manufacturing are weak. Nevertheless, the number It is not to indicate that the recession has begun or is about to begin. Nevertheless, the Chamber of Commerce lowered its 2025 GDP growth forecast to 1.6%, slightly below the potential of the U.S. economy. The expected slowdown in growth rate reflects the impact of a growing trade war, which could lead to rising inflation, disruptions in supply chains, reduced investment and spending, and weak labor markets. ”
The New York Times recently analyzed that the continued decline of the dollar may indicate that investors are beginning to avoid the dollar, which has long been regarded as a "safe haven" in the global financial markets. French Central Bank Governor Villeroy's recent "complaints" to the media reveal the voices of global monetary policy managers. In Villeroy's view, the Trump administration's protectionist policies and its capricious trade stance are shaking the trust basis of the US dollar as the world's major reserve currency and damaging market confidence in the US dollar.
Li Xiaoyong, deputy director of the Market Management Department of the Ministry of Culture and Tourism, introduced that this year's "May 19 China Tourism Day" is themed on "Bright Mountains and Rivers, Beautiful Journey", and will hold a series of activities such as theme days and theme months. All localities have guided tourist attractions, travel agencies, hotels and homestays, troupes and theaters to launch discount promotional activities such as ticket reduction, discount packages, and joint ticket discounts, and concentrated on launching cultural and tourism consumption coupon packages. At the same time, cooperative units represented by Meituan, Alipay, Gaode, Ctrip, Huazhu and Himalaya plan to invest more than 1 billion yuan in people-friendly subsidies, and local governments plan to introduce more than 6,000 people-friendly measures.
On April 21, Ling Ji, Vice Minister of Commerce and Deputy Representative for International Trade Negotiations, said at a press conference of the State Information Office that the current global economic recovery momentum is insufficient, especially the United States announced the implementation of so-called "reciprocal tariffs", which seriously damaged the multilateral trading system and seriously impacted the international trade order and the security of global production and supply chains. In order to better respond to the current external shocks and challenges, the "Comprehensive Pilot Work Plan for Accelerating the Expanding Opening of the Service Industry" highlights the content of high-standard international economic and trade rules such as CPTPP and DEPA, showing that China's determination to unswervingly expand opening up to the outside world under the current situation, further leverages the comprehensive advantages of expanding opening up in the service industry, reflecting China's willingness and determination to firmly support economic globalization, firmly safeguard the multilateral trading system, and promote common promotion of opening up and sharing development with all countries.
The head of the Circulation Development Department of the Ministry of Commerce talked about the development of my country's wholesale and retail industry from January to March 2025. Since the beginning of this year, the Ministry of Commerce has accelerated the improvement of the modern trade circulation system and taken multiple measures to promote the high-quality development of the wholesale and retail industries. According to data from the National Bureau of Statistics, from January to March, my country's wholesale and retail industry added value was 3.3 trillion yuan, an increase of 5.8% year-on-year, accounting for 10.4% of GDP. my country's wholesale and retail industries have made a good start, providing strong support for expanding domestic demand and smoothing the circulation of the national economy.
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