Trump’s Tariff Rollback Sparks Market Rally

Trump’s tariff rollback sparks market rally, boosting gold, oil, and equities; volatility persists amid trade uncertainties.

In a surprising move, U.S. President Donald Trump announced a temporary reduction in tariffs on dozens of countries for a 90-day period while simultaneously increasing duties on China. This decision provided immediate relief to financial markets, triggering a widespread rally in energy and metal commodities as well as global equities.

Gold spot prices surged over 3.5%, hitting an overnight high of $3,099.50 per ounce. The U.S. Dollar Index (DXY) experienced high volatility, fluctuating between 101.90 and 103.30 before stabilizing around 102.50 as Asian markets opened.

Impact on the Asia Session

As Asian markets digested the latest tariff developments, gold remained elevated, and the DXY edged lower. Despite the overnight surge in risk assets, market volatility persists, with lingering uncertainties across all asset classes.

The Dollar Index (DXY)

• Key Economic Events Today:
  • Consumer Price Index (CPI) – 12:30 pm GMT
  • Unemployment Claims – 12:30 pm GMT
• Outlook:
  • Inflationary pressures eased in February, and March forecasts indicate a continued decline, which could weigh on the dollar.
  • Unemployment claims have remained stable, suggesting resilience in the U.S. labor market.
  • Next 24 Hours Bias: Medium Bearish

Gold (XAU)

• Key Economic Events Today:
  • Consumer Price Index (CPI) – 12:30 pm GMT
  • Unemployment Claims – 12:30 pm GMT
• Outlook:
  • Gold demand surged following the tariff announcement, and with inflation cooling, the dollar faces downward pressure, keeping gold prices elevated.
  • Next 24 Hours Bias: Medium Bearish

Australian Dollar (AUD)

• Key Event:
  • RBA Governor Bullock’s Speech – 10:00 am GMT
• Outlook:
  • AUD rallied over 3% following the tariff relief. With the U.S. dollar weakening, the AUD is likely to remain supported.
  • Next 24 Hours Bias: Weak Bearish

New Zealand Dollar (NZD)

• Key Event: No major economic events today.
• Outlook:
  • NZD surged 2.3% following the RBNZ’s 25 bps rate cut. Despite the dovish policy, the Kiwi remains strong amid USD weakness.
  • Next 24 Hours Bias: Weak Bearish

Japanese Yen (JPY)

• Key Event: No major economic events today.
• Outlook:
  • The yen initially weakened as USD/JPY surged 3% but regained strength as demand for safe-haven assets increased.
  • Next 24 Hours Bias: Medium Bearish

Euro (EUR)

• Key Event: No major economic events today.
• Outlook:
  • EUR initially surged 1.3% before dipping but stabilized around 1.0950. Strengthening global sentiment may support further gains.
  • Next 24 Hours Bias: Medium Bullish

Swiss Franc (CHF)

• Key Event: No major economic events today.
• Outlook:
  • CHF dropped 2.5% following the tariff announcement but recovered slightly as markets reassessed risk sentiment.
  • Next 24 Hours Bias: Medium Bearish

British Pound (GBP)

• Key Event: No major economic events today.
• Outlook:
  • GBP gained nearly 0.9%, reaching an overnight high of 1.2864, as the dollar weakened and risk appetite improved.
  • Next 24 Hours Bias: Medium Bullish

Canadian Dollar (CAD)

• Key Event: No major economic events today.
• Outlook:
  • CAD strengthened as crude oil rebounded and U.S. tariff relief boosted market sentiment.
  • Next 24 Hours Bias: Weak Bearish

Oil Market Overview

• Outlook:
  • WTI crude surged 14% to hit $62.93 per barrel after the tariff relief announcement. However, weak macroeconomic fundamentals and rising U.S. crude inventories may limit further gains.
  • Next 24 Hours Bias: Weak Bearish

Conclusion

While financial markets cheered Trump’s temporary tariff rollback, lingering uncertainties remain, particularly regarding China-U.S. trade tensions. The global economic outlook remains fragile, and traders should brace for continued volatility in the coming days.

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