The Single Currency Weakened, Waiting For Mario Draghi’s Remarks, Loonie Got Solid Boost

Market Reviews

Today, Donald Trump will sign the order to impose steel and aluminum tariffs and traders are anticipating. Dow fell -0.33% to 24801.36. 10 year yield is up 0.006 at 2.883. Nikkei lifted 0.5%. HSI rose 1.4%. Japanese Yen reduced. Loonie, on the other hand, reinforced as Canada will be temporarily excluded from the tariffs. Yesterday’s BoC meeting was non-event, as members stood pat and chances for April rate hike were crushed.

Euro has significantly weakened, awaiting for today’s ECB meeting and reflecting Donald Trump’s decision. Cecilia Malmström (EU Commissioner for Trade) stated: “we have made clear that if a move like this is taken, it will hurt the European Union. It will put thousands of European jobs in jeopardy and it has to be met by firm and proportionate response”. Raphael Bostic (Atlanta Fed President) said that the impact of tax reform is suggesting a “more aggressive policy”. But, considering Donald Trump’s announcement about tariffs, it might not be easy to execute. Atlanta Fed President also warned about a serious threat of a trade war.

Australian trade surplus marked impressive 1.06 billion Aussie in January. Exports rose 4% mom to AUD 33.9 billion (non-rural production increased 4%, non-monetary gold surged 54%, but rural goods declined -8%). Imports reduced -2% to 32.9 billion Aussie. Consumption products were down -7%, non-monetary gold fell -19%, capital goods decreased 1%.Chinese trade surplus increased to 33.7 billion dollars. Exports were up 44.5% yoy while imports lifted 6.3% yoy. Today, Swiss will feature jobless rate, Germany will announce factory orders, Canada will present housing starts, new housing price index and building permits, the US will show unemployment claims.