Asia Summary and Highlights 2 April
BoJ's Ueda says US tariffs likely to push up US inflation in near term
Asia Session
As market participants quietly wait for latest tariff update, market sentiment looks calm with USD marginally higher. U.S. Treasury yields opened higher while JGB yields fall. USD/JPY is trading 0.21% higher at 149.89, fast approaching the 150 figure. U.S. Treasury Secretary Bessent's remark on tariff would not be as high as 20% and the announced tariff would be a cap, seems to have captured market participants attention.
The broad risk sentiment is undecided before actual tariff announcement as market participants seem to be anticipating likely milder tariffs from Trump. Regional equities are outperforming U.S. equities, though not by much. AUD/USD is trading 0.27% at 0.6294, NZD/USD i up 0.37% to 0.5722 while USD/CAD rose 0.05%. Else, EUR/USD is down 0.03% and GBP/USD down 0.06%.
North American session
EUR/USD and USD/JPY were little changed near 1.0780 and 149.60 respectively. Risk sensitive currencies saw some gains as equities came off their lows, GBP/USD edging above 1.29, AUD/USD rising to 0.6270 from 0.6250 and USD/CAD falling from 1.44 to 1.4325. Canadian PM Carney promised retaliation on any fresh US tariffs while moves to oppose tariffs on Canada proceeded in the US Senate.
US data did not make encouraging reading, February job openings down 194k with quits down and layoffs up, while March’s ISM manufacturing index fell to 49.0 from 50.3 with prices paid up to 69.4 from 62.4.