ForexLive Americas FX news wrap: Euro sinks, tariffs softened
ForexLive Americas FX news wrap:
- Tariff details: Trump may further raise import duties on non-NAFTA countries
- Trump: Other counties have flooded the world with cheap metals
- Bank of Canada's Lane: US protectionist rhetoric poses serious risks
- Republican Senator Jeff Flake says he's introducing bill to nullify tariffs
- Mexico says tariff pressure will have no effect on NAFTA negotiations
- US Q4 household net worth +2076B vs $1645B prior
- German economy minister says EU preparing to act proportionately to US trade measures
- Draghi: Global risks include financial deregulation
- Fed's Kashkari: Big banks still threaten the economy
- More from Draghi: Would not call recent exchanges on trade a war yet
- Draghi says missing statement text on QE must be taken in context
- Forecasts: ECB sees slightly higher growth this year but lower inflation in 2019
- ECB's Draghi says economic growth to expand by faster pace than earlier expected
- US initial jobless claims 231K vs. 220K estimate
- Canada January new housing price index +3.2% vs +3.3% y/y
- S&P 500 up 12 points to 2739
- Gold down $3.60 to $1321
- US 10-year yields down 3 bps to 2.85%
- Bitcoin down $560 to $9380
- WTI crude oil down 83-cents to $60.32
- CAD leads, CHF and EUR lag
All the build-up was on the tariff announcement and it was watered down, especially for Canada and Mexico, but the door was opened for everyone else to get an exemption as well. USD/CAD dropped to 1.2900 from 1.2950 as the exemptions for NAFTA countries were revealed. Earlier the pair had climbed higher in part due to weaker oil prices.
The bigger moves in markets were in European currencies. The first comments from Draghi were upbeat on growth but 2018 GDP forecast was only raised by 0.1 pp. So after the spike to 1.2446, EUR/USD slowly sank to 1.2298 at the lows and it finished just above the figure.
The Swiss franc and pound were also dragged lower and cable dipped below 1.3808, a more than 100 pip drop intraday.
In general, the US dollar was strong across the board and that helped USD/JPY above 106.00 as fears about a trade war are dampened.