North American Summary and Highlights 14 April
Overview - Equities saw modest gains while UST yields fell significantly. The USD however was little changed.
North American session
The USD saw some early gains but these largely faded, leaving the USD roughly where it was at the start of the session. Equities opened firmer on Trump’s exclusion of certain Chinese-built predicts from tariffs, but the gain was not significantly extended. UST yields however fell significantly. Stable long term inflation expectations in a New York Fed consumer survey despite a firmer 1-year view, and dovish comments from Fed’s Waller, suggested he would ease to support economic growth despite higher inflation if tariffs remained high, helped fuel the UST rally.
USD/JPY was little changed near 143. EUR/USD was slightly weaker near 1.1365 though EUR/GBP and EUR/CHF were also weaker near .8610 and .9240 respectively. AUD/USD was firm rising to near .6340.
European morning session
The USD was mixed in the European morning, gaining slightly against the JPY and CHF but falling back against the higher yielders as risk sentiment slightly improved. EUR/USD was not much changed just below 1.14, but USD/JPY gained around 20 pips to trade above 143. AUD/USD rose 30 pips to 0.6330 and GBP/USD gained half a figure to 1.3175. The FX moves reflected better risk sentiment, but equity futures were not much changed through the session after modest overnight gains.
There was little news of any note during the session, with the market still reacting to the pause in tech tariffs announced at the weekend and the sharp FX moves seen last week.