AUD

• 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 reinforces RBNZ rate cut expectations. Global Trends Yesterdays news that the proposed US tariffs on Mexico and Canada would be delayed by a month improved the market mood. Indeed, even news out of China that it will impose...

• 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 this can be overshadowed by tariff news. Global Trends The fallout from the US announcing trade tariffs on three of its largest trading partners (Canada, Mexico, China) rattled nerves and sent markets into a tailspin...

• 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, Canada & the US this week. Several US Fed members also speak. Global Trends After much talk the first actual shots were fired in the US led Trump 2.0 trade war over the weekend....

• Tariff threat. President Trump rattled FX markets this morning after reiterating tariffs could be imposed on Canada & Mexico on Saturday. USD rose.• Macro pulse. Overnight the data showed that US growth outpaced the Eurozone. ECB cut rates again. More moves likely to revive activity.• AUD vol. The Trump comments exerted downward pressure on the AUD. More headline driven volatility likely over the period ahead. Global Trends The economic data flow picked up overnight with the relative outperformance of the US once again on show with tariff-related comments by US President Trump rattling a few FX market nerves this...