Market Review
The US dollar index rose after fluctuating this week, and fell to its lowest level since mid-October last year at the beginning of the week. After Trump's latest threat to impose tariffs on European imports, the US dollar index fell back above the 104 mark and then fell again.
Spot gold continued to rise, setting a new high, breaking through the $3,000/ounce mark for the first time in history. Due to the increase in tariff uncertainty and the market betting that the Federal Reserve will relax monetary policy, the appeal of gold remains strong. As the price of gold hit a new high, the total market value of gold once exceeded $20 trillion, firmly ranking as the world's largest asset by market value, more than six times the market value of Apple, the second largest company.
Events of the week
1. Russia and Ukraine are expected to cease fire for 30 days? Putin agrees, but with conditions
According to reports, in exchange for military aid and intelligence sharing, Ukraine will accept the US proposal for a 30-day ceasefire with Russia. The US will immediately lift the suspension of intelligence sharing and provide security assistance to Ukraine. The two presidents agreed to reach a comprehensive agreement on the development of key mineral resources in Ukraine as soon as possible to enhance Ukraine's economy and ensure Ukraine's long-term prosperity and security.
Ukrainian President Zelensky praised the meeting as constructive on Wednesday and said that a possible 30-day ceasefire agreement with Russia could be used to draft a broader peace agreement. He said that Ukraine supports the United States to end Russia's three-year military operation as soon as possible, and the resumption of military aid and intelligence sharing by the United States is a very positive signal.
Russian President Putin said that Russia agreed to a 30-day ceasefire, but Russia currently has an advantage on the Kursk front. Whether the Ukrainian army retreats unscathed or lays down its arms and surrenders on the spot, these issues need to be resolved. Putin also said that how the parties monitor the ceasefire and how to resolve many details need further discussion. Putin said he might communicate with Trump on the above issues.
In addition, Putin said that if the United States and Russia agree on energy cooperation, then natural gas supplies can be provided to Europe, and European natural gas prices plummeted upon hearing this.
When Trump met with NATO Secretary-General Rutte at the White House, he described Putin's statement as very promising, but incomplete. He was willing to meet or talk with Putin, emphasizing that a ceasefire agreement must be reached as soon as possible. Zelensky believes that Putin is ready to reject the ceasefire proposal, but dare not tell Trump directly that Russia has set conditions for the ceasefire, trying to delay the ceasefire or make it impossible to achieve.
Sources said that Russia has presented the United States with a list of requirements for an agreement to end the Ukrainian conflict. The specific requirements are unclear, but sources said that these requirements are roughly similar to those previously presented to the United States, NATO and Ukraine. These requirements include that Kiev should not join NATO, that NATO should not deploy foreign troops in Ukraine, and that the international community recognizes Crimea and four Ukrainian provinces as Russian territory.
Previously, the United States has been urging Russia to accept its peace proposal made earlier this week, which would implement a ceasefire in the sky, in the air and across the front line. Trump also threatened to impose "devastating" economic penalties on Russia if it did not accept the proposal. G7 members are also said to have discussed the possibility of imposing greater costs on Russia, including further sanctions, if a ceasefire agreement cannot be reached.
According to CBS, citing four people familiar with the matter, the Trump administration is further restricting Russia's use of the US payment system, thereby imposing more restrictions on Russia's oil, gas and banking industries.
2. Trump's tariff threat continues, Canada and the EU fight back
US President Trump's decision to impose a 25% tariff on all US imports of steel and aluminum took effect on Wednesday, and no exemptions have been approved yet. US Commerce Secretary Lutnick said nothing can stop the tariffs, and Trump will also implement trade protection on copper in the future. This led to swift retaliation from Canada and Europe.
Canada announced a 25% retaliatory tariff on goods including steel, aluminum, computers, sports equipment and other products, with a total value of 29.8 billion Canadian dollars. In addition, Canada's energy minister said that if the trade war with the United States escalates, Canada may take non-tariff measures, such as restricting crude oil exports. Earlier, Trump withdrew his threat to double Canada's steel and aluminum tariffs to 50% after Ontario announced a suspension of a 25% surcharge on electricity exports to the United States.
The European Commission also quickly responded to the US tariffs, saying it would impose counter-tariffs on US goods worth 26 billion euros (about 28 billion US dollars) from next month. Trump said on social media that the European Union is one of the most hostile and abusive tax and tariff institutions in the world, and its only purpose is to take advantage of the United States. The European Union has just imposed a nasty 50% tariff on whiskey. If this tariff is not immediately lifted, the United States will soon impose a 200% tariff on all wine, champagne and alcohol products from France and other EU representative countries.
In addition, the Mexican president refused to respond to the US metal tariffs, and he will wait for the April 2 deadline, after the US tariffs on foreign steel and aluminum supplies have come into effect.
3. Canada cuts interest rates to deal with tariffs, will be cautious about future moves
The Bank of Canada cut its key policy rate by 25 basis points to 2.75% on Wednesday and warned that "a new crisis" is coming as it tries to prepare the economy for the damage that Trump's tariffs may cause. The rate cut marks the seventh consecutive easing of monetary policy by the Bank of Canada, cutting the benchmark interest rate by a total of 225 basis points in 9 months, making it one of the most aggressive central banks in the world.
The Bank of Canada also said that it would "be cautious in making any further interest rate adjustments" given the need to assess the upward pressure on inflation caused by rising costs and the downward pressure from weak demand. "By the end of 2024, our economic foundation is solid. But we are now facing a new crisis. Depending on the scope and duration of the new US tariffs, the economic impact may be severe. Uncertainty itself has already caused harm."
4. Good news from CPI and PPI, will the Fed restart rate cuts in June?
The U.S. CPI data for February was lower than expected across the board. The unadjusted CPI for February was 2.8% annually, the lowest since November last year; the monthly rate was 0.2%, the lowest since October last year; the core CPI annual rate was 3.1%, the lowest since April 2021; the monthly rate was 0.2%, the lowest since December last year. On Thursday, U.S. producer prices unexpectedly remained flat in February, but the cooling trend is unlikely to continue as import tariffs are expected to push up commodity prices in the coming months.
After the data was released, traders still expected the Fed to resume rate cuts in June, while increasing bets that the Fed will cut rates at least twice this year.
Earlier, a New York Fed survey showed that U.S. consumers became more pessimistic about their financial situation in February, and short-term inflation expectations rose slightly, but long-term inflation expectations remained stable.
In addition, people familiar with the matter revealed that the Trump administration will nominate Federal Reserve Governor Bowman as the Fed's vice chairman for supervision as early as today. Earlier this year, Barr resigned as the Fed's vice chairman for supervision, avoiding a possible fight with Trump over the position.
Trading is not easy. It requires meticulous thinking and rigorous operation. I hope you can get out of the quagmire of losses as soon as possible and get on the right track of steady gains.
The US dollar index rose after fluctuating this week, and fell to its lowest level since mid-October last year at the beginning of the week. After Trump's latest threat to impose tariffs on European imports, the US dollar index fell back above the 104 mark and then fell again.
Spot gold continued to rise, setting a new high, breaking through the $3,000/ounce mark for the first time in history. Due to the increase in tariff uncertainty and the market betting that the Federal Reserve will relax monetary policy, the appeal of gold remains strong. As the price of gold hit a new high, the total market value of gold once exceeded $20 trillion, firmly ranking as the world's largest asset by market value, more than six times the market value of Apple, the second largest company.
Events of the week
1. Russia and Ukraine are expected to cease fire for 30 days? Putin agrees, but with conditions
According to reports, in exchange for military aid and intelligence sharing, Ukraine will accept the US proposal for a 30-day ceasefire with Russia. The US will immediately lift the suspension of intelligence sharing and provide security assistance to Ukraine. The two presidents agreed to reach a comprehensive agreement on the development of key mineral resources in Ukraine as soon as possible to enhance Ukraine's economy and ensure Ukraine's long-term prosperity and security.
Ukrainian President Zelensky praised the meeting as constructive on Wednesday and said that a possible 30-day ceasefire agreement with Russia could be used to draft a broader peace agreement. He said that Ukraine supports the United States to end Russia's three-year military operation as soon as possible, and the resumption of military aid and intelligence sharing by the United States is a very positive signal.
Russian President Putin said that Russia agreed to a 30-day ceasefire, but Russia currently has an advantage on the Kursk front. Whether the Ukrainian army retreats unscathed or lays down its arms and surrenders on the spot, these issues need to be resolved. Putin also said that how the parties monitor the ceasefire and how to resolve many details need further discussion. Putin said he might communicate with Trump on the above issues.
In addition, Putin said that if the United States and Russia agree on energy cooperation, then natural gas supplies can be provided to Europe, and European natural gas prices plummeted upon hearing this.
When Trump met with NATO Secretary-General Rutte at the White House, he described Putin's statement as very promising, but incomplete. He was willing to meet or talk with Putin, emphasizing that a ceasefire agreement must be reached as soon as possible. Zelensky believes that Putin is ready to reject the ceasefire proposal, but dare not tell Trump directly that Russia has set conditions for the ceasefire, trying to delay the ceasefire or make it impossible to achieve.
Sources said that Russia has presented the United States with a list of requirements for an agreement to end the Ukrainian conflict. The specific requirements are unclear, but sources said that these requirements are roughly similar to those previously presented to the United States, NATO and Ukraine. These requirements include that Kiev should not join NATO, that NATO should not deploy foreign troops in Ukraine, and that the international community recognizes Crimea and four Ukrainian provinces as Russian territory.
Previously, the United States has been urging Russia to accept its peace proposal made earlier this week, which would implement a ceasefire in the sky, in the air and across the front line. Trump also threatened to impose "devastating" economic penalties on Russia if it did not accept the proposal. G7 members are also said to have discussed the possibility of imposing greater costs on Russia, including further sanctions, if a ceasefire agreement cannot be reached.
According to CBS, citing four people familiar with the matter, the Trump administration is further restricting Russia's use of the US payment system, thereby imposing more restrictions on Russia's oil, gas and banking industries.
2. Trump's tariff threat continues, Canada and the EU fight back
US President Trump's decision to impose a 25% tariff on all US imports of steel and aluminum took effect on Wednesday, and no exemptions have been approved yet. US Commerce Secretary Lutnick said nothing can stop the tariffs, and Trump will also implement trade protection on copper in the future. This led to swift retaliation from Canada and Europe.
Canada announced a 25% retaliatory tariff on goods including steel, aluminum, computers, sports equipment and other products, with a total value of 29.8 billion Canadian dollars. In addition, Canada's energy minister said that if the trade war with the United States escalates, Canada may take non-tariff measures, such as restricting crude oil exports. Earlier, Trump withdrew his threat to double Canada's steel and aluminum tariffs to 50% after Ontario announced a suspension of a 25% surcharge on electricity exports to the United States.
The European Commission also quickly responded to the US tariffs, saying it would impose counter-tariffs on US goods worth 26 billion euros (about 28 billion US dollars) from next month. Trump said on social media that the European Union is one of the most hostile and abusive tax and tariff institutions in the world, and its only purpose is to take advantage of the United States. The European Union has just imposed a nasty 50% tariff on whiskey. If this tariff is not immediately lifted, the United States will soon impose a 200% tariff on all wine, champagne and alcohol products from France and other EU representative countries.
In addition, the Mexican president refused to respond to the US metal tariffs, and he will wait for the April 2 deadline, after the US tariffs on foreign steel and aluminum supplies have come into effect.
3. Canada cuts interest rates to deal with tariffs, will be cautious about future moves
The Bank of Canada cut its key policy rate by 25 basis points to 2.75% on Wednesday and warned that "a new crisis" is coming as it tries to prepare the economy for the damage that Trump's tariffs may cause. The rate cut marks the seventh consecutive easing of monetary policy by the Bank of Canada, cutting the benchmark interest rate by a total of 225 basis points in 9 months, making it one of the most aggressive central banks in the world.
The Bank of Canada also said that it would "be cautious in making any further interest rate adjustments" given the need to assess the upward pressure on inflation caused by rising costs and the downward pressure from weak demand. "By the end of 2024, our economic foundation is solid. But we are now facing a new crisis. Depending on the scope and duration of the new US tariffs, the economic impact may be severe. Uncertainty itself has already caused harm."
4. Good news from CPI and PPI, will the Fed restart rate cuts in June?
The U.S. CPI data for February was lower than expected across the board. The unadjusted CPI for February was 2.8% annually, the lowest since November last year; the monthly rate was 0.2%, the lowest since October last year; the core CPI annual rate was 3.1%, the lowest since April 2021; the monthly rate was 0.2%, the lowest since December last year. On Thursday, U.S. producer prices unexpectedly remained flat in February, but the cooling trend is unlikely to continue as import tariffs are expected to push up commodity prices in the coming months.
After the data was released, traders still expected the Fed to resume rate cuts in June, while increasing bets that the Fed will cut rates at least twice this year.
Earlier, a New York Fed survey showed that U.S. consumers became more pessimistic about their financial situation in February, and short-term inflation expectations rose slightly, but long-term inflation expectations remained stable.
In addition, people familiar with the matter revealed that the Trump administration will nominate Federal Reserve Governor Bowman as the Fed's vice chairman for supervision as early as today. Earlier this year, Barr resigned as the Fed's vice chairman for supervision, avoiding a possible fight with Trump over the position.
Trading is not easy. It requires meticulous thinking and rigorous operation. I hope you can get out of the quagmire of losses as soon as possible and get on the right track of steady gains.
Continuously release precise trading plans to lead members to expand profits, with a stable profit of 988% every month. If you have not made a profit yet, then join us. t.me/fahsufnwks
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Continuously release precise trading plans to lead members to expand profits, with a stable profit of 988% every month. If you have not made a profit yet, then join us. t.me/fahsufnwks
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.