Trading remained relatively subdued across European markets yesterday as investors held their breath in anticipation of a major policy move from the White House. The long-awaited announcement came after market hours, with President Trump unveiling a raft of new tariff measures aimed at key US trading partners.
Markets in Wait-and-See Mode
With little in the way of fresh economic data during the session, FX markets saw low volatility. Major currency pairs, including EUR/USD and GBP/USD, drifted within tight trading ranges. While the US dollar faced mild downward pressure, there was little momentum for a breakout in either direction.
New Tariffs Unveiled Post-Close
Once European and US markets had closed for the day, the Trump administration revealed the details of its latest tariff strategy:
- A flat 10% universal tariff was implemented.
- Country-specific rates added another layer of complexity:
- EU exports to the US now face a 20% tariff.
- UK goods are subject to a 10% rate.
- Chinese imports will be hit hardest, with a significant 34% tariff.
This aggressive trade policy signals a renewed focus on protectionism, setting the stage for potential retaliation and uncertainty in the global trade landscape.
What to Watch Next
Investors will now be closely watching how global markets react to this escalation in trade tensions. Any retaliatory measures from affected nations could drive significant volatility, particularly in currency markets.
On the economic calendar, several key events are expected to influence trading sentiment:
- ECB March meeting minutes will provide insight into the central bank’s monetary policy direction.
- In the US, the spotlight is on:
- ISM Non-Manufacturing PMI (March) – a key indicator of economic health.
- Weekly Initial Jobless Claims – offering a snapshot of labour market strength.
Navigating Market Uncertainty
With geopolitical risks mounting and policy changes driving volatility, businesses and investors should remain agile. Our currency experts at Qumoney are here to help you interpret market movements and capitalise on opportunities as they arise.
Get in touch with us today to discuss tailored strategies for your international payments and currency risk management.