EUR/GBP Struggles Due to Trade War Fears
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EUR/GBP continues its downward momentum around 0.8396, as the euro? faces pressure from escalating trade tensions following US President Trump’s tariff threats. The EU has retaliated with tariffs on US products, while Germany’s state borrowing plans have encountered setbacks. Market concerns regarding the EU-US trade war and the potential for a German recession have increased, with investors eagerly awaiting the Bank of England’s monetary policy decision and essential UK economic data. The outcomes of trade negotiations and economic developments will affect EUR/GBP movements.
USD/CAD Sinks After BoC Rate Cut
USD/CAD fell to 1.4397 following the Bank of Canada’s (BoC) 25bps rate cut, marking its seventh consecutive reduction. BoC Governor Tiff Macklem highlighted concerns regarding US trade uncertainty and potential tariffs. The Canadian dollar is also impacted by market volatility surrounding US tariffs on Canadian goods. Meanwhile, softer US inflation data and worries about a US recession weighed on the greenback, with speculation that the Federal Reserve may lower rates sooner than anticipated. The upcoming US Producer Price Index (PPI) data will influence the direction of USD/CAD.
EUR/JPY Declines Amid EU-US Trade War Concerns
EUR/JPY softened to near 161.10, driven by risk-off sentiment and rising demand for safe-haven assets. The yen benefited from Japan’s robust economic data and expectations of a rate hike by the Bank of Japan, although concerns about President Trump’s potential tariffs on Japan weighed on the currency. The euro struggled amid market uncertainty regarding the EU’s retaliatory measures and Germany’s borrowing plans. Trade tensions and fears of recession in both the US and the EU will continue to influence EUR/JPY in the coming days.
AUD/USD Wobbles Ahead of US PPI Data
AUD/USD dipped to 0.6286 as concerns regarding the US-China trade war and softer inflation data weighed on the Australian dollar. The softened US CPI data has raised expectations of an earlier Fed rate hike, which supports the greenback. Meanwhile, escalating trade tensions and retaliatory tariffs from China on US goods exerted pressure on the Aussie. Australian domestic data shows a mixed economic outlook, with consumer sentiment improving but business confidence declining. The forthcoming US Producer Price Index (PPI) data will be crucial in determining AUD/USD direction.
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