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27 Mar 2025

Planes, trains & automobiles

• US tariffs. Tariff developments dominate the headlines. Yesterday the US announced 25% duties on vehicle imports. Reciprocal tariffs due 2 April.• Holding on. Equities eased, as did the USD. NZD ticked higher while AUD is hovering near ~$0.63. RBA & US jobs report also on the radar next week.• EUR risks. EUR strengthened over the past month. Is too much good news priced in? EU exposed to vehicle tariffs. EU is a large US trading partner. Global Trends US tariff developments continue to dominate the headlines and generate bursts of market volatility. Yesterday morning the US Administration came through...

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AUD/EUR: signs of life emerging

The jump up in the EUR over March, particularly in the first few weeks of the month, on the back of the optimism about the Eurozone’s growth prospects stemming from the ‘sea change’ in fiscal/defence spending, has been a key theme in FX markets (chart 1). The EUR’s resurgence has also been an important force that has dragged crosses like AUD/EUR and NZD/EUR to the lower end of their respective multi-year ranges. At face value, the underlying shift coming through with regards to fiscal spending and infrastructure investment by governments is a longer-term economic support for Europe. This helps reinforce...

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