Tariff fears reignite safety flows
The JPY is the strongest of the major currencies while the CAD is the weakest as North American traders enter the fray. Pres. Trump's announcement of a escalating tariff schedule on Mexico until immigration flows are stopped, and fears of increased US/China tension has stocks and bond yields down sharply and the forex mode dialed to the "flight to safety" trades.
Looking at the changes and ranges for the major currency pairs, the USDJPY and the JPY crosses are getting the most attention. They have all tumbled lower and trade at session lows. The GBPUSD is near the lows and USDCAD is near the session highs. Activity in AUDUSD and NZDUSD is is up and down but near the lows.
In other markets, the snapshot shows:
- Spot gold is up $9 or 0.70% at $1297.74
- WTI crude oil is down -$1.16 or -2.05% at $55.43 on global slowdown fears
- Bitcoin on Coinbase is down -$220 at $8250.
The US stocks are down sharply. Futures are implying:
- Dow, -265 points
- S&P, is down -31 points
- Nasdaq is down -101 points
In Europe, major indices are also sharply lower:
- German Dax, -1.8%
- France's CAC -1.46%
- UK FTSE -1.0%
- Spain's Ibex -1.7%
- Italy's FTSE MIB. -1.50%
In the US debt market, yields are sharply lower on flight to safety flows:
European 10 year yields are also lower (German 10 year now wa -0.203%. Wow) with the exception of the Italian bonds which investors are shunning.
