North American Summary and Highlights 24 March
Overview - The USD was supported, particularly versus the JPY, as equities rallied on hopes Trump’s tariffs would be less aggressive than feared.
North American session
Reports that Trump’s April 2 tariff announcement would be less broad based than feared triggered a rally in equities, that was further fuelled by a rise in the S and P services PMI to 54.3 from 51.0, though manufacturing fell to 49.8 from 52.7. Late in the session Trump appeared to confirm the earlier reports by stating a lot of countries may get breaks on tariffs, though he added that he would announce additional tariffs on autos, lumber and chips, and that not all tariffs would be included on April 2.
With UST yields rising, the USD rallied, USD/JPY up a big figure to trade above 150.50. EUR/USD edged off its lows on Trump’s comments but still ended near 1.08, down from 1.0850. EUR slipped versus GBP and CHF, with GBP/USD finding support around 1.29. AUD/USD and USD/CAD were little changed.
European morning session
FX was fairly quiet through the European morning session. EUR/USD gained marginally to 1.0850 from 1.0840, and USD/JPY fell back a little after overnight gains, dropping to 149.60 from 149.70. GBP, NOK, CHF and AUD were the best performers, all gaining around 0.2% against the USD, with the CAD rising in line with the EUR and JPY.
The European PMI data was the main news of the morning. The Eurozone composite PMI was slightly weaker than expected, with services disappointing. However, the manufacturing index was stronger than expected, and the composite still rose slightly on the month to 50.4. The UK composite PMI came in stronger than expected at 52.0, due to a strong rise in the services index, but the manufacturing index fell back to its weakest since 2023.