Psychology for major markets Aug 1

USD firm after latest tariff increases
EUR/USD – EUR/USD continuing to weaken as the trade deal with the US is seen as less favourable to the EU than hoped, and new tariff increases undermine risk sentiment.
USD/JPY – USD/JPY at its highest since March on general USD strength and a perception of a less hawkish BoJ, helped by resilient equities although crosses are off their highs as equities slip back.
EUR/GBP – Broke above 0.87 after weaker than expected UK June retail sales, but has slipped back below as UK/US trade deal seen as favourable relative to EU deal. 0.86 nevertheless likely to be solid support.
AUD/USD – Slipping back below the middle of the year’s range as the USD rallies generally on trade news and RBA rate cut looks more certain after CPI data.
Equities – S&P futures made new highs on strong Meta and Microsoft results, but has slipped back on new tariff increases. Valuation remains extreme.