Following Trumps tariff announcement, we saw the Dollar take a bit of a beating in yesterday’s trading session, opening a door for GBP pushing to highs not seen since October 2024. With his Liberation Day plans outlined it has now heightened concerns of a US recession, having the average tariff around 20% some analysts have suggested these will hurt the US more than economies receiving the tariffs.
Alongside the sell off of the US Dollar, the stock market also took a hit with the S&P trading near its lowest since last August, despite all this, President Trump is yet to acknowledge the effects.
Sterling capitalized on the weakening Dollar and saw gains not seen since October last year, despite the UK being hit with 10% tariffs, which didn’t look like it was on the cards weeks ago.
The tariff for the UK has shown a trade deal was not struck when Starmer and Trump met, however mixed comments have been made suggesting a renegotiation between the two countries, but on the flip side there are also suggesting of ‘retaliation’. Any sign of retaliation or hostility may cause upset and increase volatility as a bi-product.
Euro rallied near on 2% yesterday despite the 20% tariff implementation and a stock market sell off, the Euro held its ground.
Markets will now keep a keen eye on the release of Non-Farm payrolls and unemployment rate this afternoon, followed by a speech from FED Chair Jerome Powell later this evening. Could any clues be given as to their direction with interest rates?
-Oakleigh Exchange Partners-