Chartbook: March 21

The US job creation engine slowed in January, but revisions to November and December numbers illustrated continued strength in labour markets, helping keep the Federal Reserve firmly sidelined. According to data just released by the Bureau of Labor Statistics, just 143,000 jobs were added in the month—undershooting the 175,000-position consensus forecast—but December’s headline print was revised higher...

• Holding pattern. Modest moves in most markets overnight. JPY’s upswing extends. AUD range bound just above its 1-month average.• UK rates. BoE cut interest rates by 25bps. 2 members voted for a larger move. More easing expected over time. AUD/GBP supported overnight.• US jobs. US employment report in focus tonight. Signs the US labour market is cooling could revive US Fed rate cut bets &...

Financial markets are overcoming post-traumatic stress syndrome three days after Donald Trump started—and then temporarily paused—a potentially-catastrophic trade war with Canada and Mexico. Benchmark ten-year Treasury yields are inching lower and major equity bourses are headed for a stronger open after Treasury Secretary Scott Bessent called tariffs a “means to an end,” and said the new administration...

• Market swings. US equities ticked up while bond yields fell. This weighed on the USD. AUD & NZD continue to recover lost ground.• Data flow. US ADP employment improved but the services ISM declined. Non-farm payrolls released on Friday night. BoE rate cut expected tonight.• Stronger JPY. Wages in Japan accelerated. More BoJ rate hikes anticipated. This is JPY supportive. We see more AUD/JPY downside...

• Positive vibes. Yesterday’s news tariffs on Mexico & Canada have been delayed boosted risk sentiment & weighed on the USD. But will it last?• Tariff risks. China announced countermeasures. Risk of the US imposing tariffs on EU remains. More headline-driven volatility likely over period ahead.• AUD & NZD. AUD bounced above its 1-month average. NZD also rebounded, but higher NZ unemployment...

A sense of normalcy is returning to financial markets this morning after Donald Trump backed off threats against Canada and Mexico, granting the countries a 30-day reprieve from his proposed 25-percent tariffs. The dollar is retreating amid sluggish price action in currency markets, ten-year yields are down as inflation expectations recede, and equity markets are setting up for a soft open. Measures...

• Tariff news. Tariff-related risk aversion & the stronger USD unwound overnight. News tariffs on Mexico & Canada will be delayed boosted sentiment.• FX swings. After falling sharply AUD & NZD are back around where they ended last week. More headline driven volatility should be anticipated.• Data flow. In the US, JOLTS job openings due tonight. In NZ, Q4 jobs report is out tomorrow. But...

• Tariff news. US announced tariffs against Canada, Mexico, & China. This had been in the pipeline for a while. Canada also unveiled retaliatory action.• USD stronger. The news has boosted the USD this morning. AUD & NZD on the backfoot. Uncertainty & macro headwinds are usually USD supportive.• Event Radar. Tariff news will be in the drivers seat. Data-wise, jobs reports are out in NZ,...

In a response that could add momentum to an escalatory cycle, Prime Minister Justin Trudeau this evening said “Canada will be responding to the US trade action with 25 percent tariffs on $155 billion dollars worth of American goods,” including immediate tariffs on $30 billion as of Tuesday, and another $125 billion in 21 days* to allow Canadian companies to seek alternatives”. “This is a threat against...

Ending—and beginning—weeks of speculation, President Donald Trump has delivered details of his tariff plan to officials in Ottawa and Mexico City, raising taxes on most imports from Canada and Mexico to 25 percent, in a move that is likely to generate upheaval in the world’s largest integrated trading area and trigger another round of disruption in foreign exchange markets. According to major Canadian...