GBP volatility hinges on rate cuts and tariffs
The Bank of England is expected to cut interest rates this week, balancing the need to support slowing growth against the risk of renewed inflation.
A 25bp cut is largely priced in, but Goldman Sachs anticipates gradual GBP weakness rather than an immediate sharp decline, though a more dovish stance could pose...
Markets are already showing signs of recovery after the sharp risk-off gap lower. The market selloff around tariffs appears overstated, likely exacerbated by thin trading conditions.
Recent U.S. tariff actions could be scaled back as negotiations progress, and markets tend to fill open gaps. The Canadian dollar saw significant weakness, hitting its lowest level...
EURUSD braces for U.S. tariff threat
Tariff developments continue to drive market volatility, with new headlines emerging daily.
On Sunday, U.S. President Donald Trump warned that tariffs on the European Union were inevitable. In response, EU leaders indicated they are prepared to retaliate if the U.S. imposes new tariffs on European goods.
This follows...
Fidelity Digital Assets recently published a report predicting more nation-states, central banks, and sovereign wealth funds will establish strategic Bitcoin reserves. Countries, including Russia, Brazil, and Poland are called out in the report but it is suggested that governments may choose to buy discreetly to avoid influencing prices.
Last week, ECB President...
The FED decision has come and gone, and in the end, no major surprises. As expected, the central bank left rates on hold, with most of the market reaction coming from the Fed chair presser.
Jerome Powell gave something to everyone, leaving the net results rather balanced. On one side, he said the central bank was in no rush to cut rates, fueling hawkish sentiment...
Gold has reached a new record high price, surpassing the November peak by approximately $10 at the time of writing.
Political uncertainty in the U.S., particularly concerning trade policy, is fueling the rally. Reports indicate that the Trump administration is "not close at all to making a decision" on China tariffs. Meanwhile, Beijing has signaled flexibility...
US durable goods and consumer confidence data came in softer on Tuesday but did nothing to prevent the US dollar from rallying. In the end, everything has come down to tariff talk out of the US government, and with the Trump Administration continuing to talk tough on tariffs, the US dollar is the natural play.
It is also worth noting that many market participants...
Will Trump replace Powell as Fed Chair?
The Federal Reserve has kept interest rates unchanged in its first meeting of the year, but markets are watching for Donald Trump’s response.
Last week, Trump demanded the Fed lower interest rates and talked about how he was more qualified to set interest rates for the country. While he has no direct authority over rate...
We're coming out of a week in which the US dollar was the worst-performing major currency for a change. The reversal in the Dollar's fortunes came from softer Trump Administration talk on trade, higher US equities, and an expectation the Fed may still do more than less when it comes to rate cuts in 2025.
Solid PMI data out of the Euro Zone and UK also helped to...
A small Chinese AI startup, DeepSeek, is responsible for erasing $2 trillion from the US equity market, within 12 hours.
Nvidia's stock is down ~17% at the time of writing, while shares of other US-based AI-related companies, including Oracle, Broadcom, and AMD, have fallen between 12% and 20%. Microsoft, a major investor in OpenAI, has also dropped more than...
During his presidential campaign, Donald Trump suggested he should have influence over interest rate decisions.
Now, the US dollar has weakened, and the S&P 500 has reached record highs as Trump publicly demanded that the Federal Reserve lower interest rates.
Although Trump doesn't have the power to overrule the Federal Reserve, his unconventional politicking...
Deutsche Bank thinks markets may be underestimating the risk of a trade war between the US and Canada.
In its analysis, the bank suggests that USD/CAD could rise to "at least" 1.53, with the potential to test the 2002 all-time high of 1.61. A trade war could push Canada into a recession, prompting the Bank of Canada to cut interest rates to as low as 1.50%,...
The US dollar remains strong despite recent sell-off attempts. Uncertainty around President Trump’s tariff policies continues to influence market sentiment. Trump's announcement of plans to impose 25% tariffs on Canada and Mexico by February 1 has attracted significant attention. The Canadian dollar has dropped to a multi-year low, with USD/CAD trading above 1.45...
Central bank decisions this week are poised to affect currencies, stocks, and bonds. Here’s what’s happening over the next 7 days:
The Bank of Japan (BoJ) Monetary Policy Meeting is scheduled for January 23-24, 2025. The yen rose against the dollar on Tuesday as traders anticipated a ~90% chance of an interest rate hike despite tariff concerns tied to Donald...
The dollar index dropped nearly 1% to 108.3 following the inauguration speech of President Trump, as the President did not confirm the implementation of immediate tariffs on day one, as previously pledged.
Bitcoin surged over 5% to reach a record high of $109,000 ahead of President Trump's inauguration. However, a newly released document from the Trump...
Inauguration Week: Opportunities in Stocks, Forex, and Crypto
Trump’s inauguration on January 20, 2025, marks the start of a new chapter for markets, with potential volatility from incoming executive orders.
Cryptocurrency
On January 17, 2025, Donald Trump surprised the industry by launching a meme cryptocurrency, $TRUMP, which has already reached a...
The Bank of Japan (BoJ) will hold its first policy meeting of the year next week, with markets pricing in a 90% likelihood of a rate hike on January 24.
Last year, BoJ rate hikes contributed to the Yen carry trade unwind in early August, coinciding with Bitcoin’s decline to $49,000.
This week, the Japanese yen strengthened toward 155.5 per dollar, its highest...
The US dollar is lower across the board, taking hits from news of a less aggressive Trump tariff plan and softer US producer prices.
The Yen has found additional demand after the Bank of Japan Governor made hawkish comments, leaving the door open for another BOJ rate hike as early as this month.
In the UK, softer inflation data prevented the pound from...
