North American Summary and Highlights 9 April

North American session

The morning was generally quiet with equities, bonds and FX all struggling for direction. The early afternoon saw a healthy 10-year auction lift risk appetite. The news of the day followed, Trump reducing reciprocal tariffs to 10% across the board for a 90-day pause while extending the rate to 125% for China. This saw equities surging.  

USD/JPY saw the strongest response, surging from 145 to 148. EUR/USD slipped below 1.10, contrasting a rise in GBP/USD above 1.28, sending EUR/GBP down to ,8540 from .8640. AUD/USD rose to .6170 from .6040. USD/CAD slipped below 1.41 from 1.4180.  

European morning session 

The USD was not much changed through the European morning, holding steady against most currencies after overnight losses. However, AUD/USD made some modest gains, rising around 30 pips to 0.6015.  

There wasn’t much news of any note. BoJ governor Ueda’s press conference early in the session produced no surprises, maintaining the view that there was scope for BoJ tightening further out if the economy continues to strengthen and underlying inflation continues to rise, but noting the risks from trade and tariffs.  

There was no European data of note, but European equities declined and front end EUR yields fell. But longer-term EUR yields were little changed as the sharp rise in US long term yields generally pulled longer dated yields higher, with UK long gilt yields matching the rise in the US.