Global Markets:

•  Asian Stock Markets : Nikkei up 1.98%, Shanghai Composite up 0.19%, Hang Seng up 2.40% ASX up 1.40%
• Commodities : Gold at $3333.35 (-2.09%), Silver at $32.68 (-0.35%), Brent Oil at $68.08 (0.95%), WTI Oil at $64.30 (0.99%)
• Rates : US 10-year yield at 4.354, UK 10-year yield at 4.5430, Germany 10-year yield at 2.4570

News & Data:

• (USD) Richmond Manufacturing Index  -13  to -6  expected
• (EUR) Consumer Confidence  -17  to -15  expected

Markets Update:

Asia-Pacific markets rose on Wednesday, following overnight gains on Wall Street fueled by optimism over easing U.S.-China trade tensions. Investor sentiment improved after U.S. President Donald Trump suggested that the final tariffs on Chinese goods entering the U.S. would not reach the previously speculated 145%, though they wouldn’t be eliminated entirely. He also reassured markets by confirming that Federal Reserve Chair Jerome Powell will remain in his role, easing concerns about the central bank’s independence.

Hong Kong led regional gains, with the Hang Seng Index climbing 2.48% and the Hang Seng Tech Index jumping 3.21%. Mainland China’s CSI 300 index edged up 0.22%. In Japan, the Nikkei 225 advanced 2.09%, while the broader Topix index added 2.05%.

Indian equities also traded higher, as the Nifty 50 rose 0.64% and the BSE Sensex gained 0.56%. South Korea’s Kospi climbed 1.51%, and the Kosdaq gained 0.93%. Meanwhile, Australia’s S&P/ASX 200 increased by 1.22%.

U.S. futures moved higher as Trump’s comments on Powell reassured investors. This followed a strong rebound in U.S. markets overnight, driven by hopes of reduced trade tensions with China.

The Dow Jones Industrial Average surged 1,016.57 points, or 2.66%, closing at 39,186.98. The S&P 500 rose 2.51% to 5,287.76, while the Nasdaq Composite jumped 2.71%, finishing at 16,300.42.

Overall, global markets rallied on signs of diplomatic progress and policy stability in the U.S., lifting investor confidence across regions.

Upcoming Events: 

• 01:45 PM GMT – USD Flash Manufacturing PMI
• 01:45 PM GMT – USD Flash Services PMI
• 02:00 PM GMT – USD New Home Sales

The post Wednesday 23rd April 2025: Asia-Pacific Markets Rally as Easing U.S.-China Trade Tensions Boost Global Sentiment first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 23 April 2025

What happened in the Asia session?

Composite PMI activity in Australia eased slightly from 51.6 in the previous month to 51.4 in April, based on the flash report by S&P Global. This index registered its seventh successive month of expansion, fuelled by strong gains in both manufacturing and services output, as new business orders rose at the sharpest pace in three years. Service providers saw particularly strong demand, while manufacturers experienced more modest gains. The robust flash report will likely keep the Aussie elevated today. 

Meanwhile, Japan’s Composite PMI activity returned to expansion in April with a reading of 51.1, as business activity increased for the fifth time in six months, driven by a rebound in the service sector. Both new orders and employment grew at a faster pace, despite a renewed drop in foreign sales, highlighting an improvement in both manufacturing and services output, which could spark higher demand for the yen.

What does it mean for the Europe & US sessions?

The Composite PMI for the Euro Area climbed to 50.9 in March, exceeding market forecasts. Not only did it mark the third consecutive month of expansion, but it also was the strongest growth since last August. Overall PMI activity is now expected to slow in April, based on the flash estimates, but it should still notch another month of expansion, albeit at a softer pace.

Composite PMI activity in the U.K. rebounded in March, rising from 50.5 in the previous month to 51.5. It marked the fastest growth since last October, driven primarily by a pickup in services output. However, overall PMI output for April is anticipated to slow in April, based on the flash estimates, which could create temporary headwinds for Cable before the start of the European trading hours.

The Dollar Index (DXY)

Key news events today

Federal Reserve Governor Waller’s Speech (1:35 pm GMT)

S&P Global Composite PMI (1:45 pm GMT)

What can we expect from DXY today?

Federal Reserve Governor Christopher Waller will deliver his opening remarks, along with Federal Reserve Bank of St. Louis President Alberto Musalem, at a Fed Listens event hosted by the Federal Reserve Bank of St. Louis. Given the recent ‘attack’ on the Fed, in particular Chairman Jerome Powell, by U.S. President Donald Trump, Governor Waller could be fielded with questions on the Fed’s independence and how they intend to manoeuvre around these ‘jabs’ from President Trump as the FOMC meeting in May inches closer. After which, the flash Composite PMI report for April is expected to show manufacturing activity falling into contraction once more while services output is anticipated to expand steadily, albeit at a slower pace. Should PMI activity slow more than originally forecasted, the greenback is likely to face even stronger overhead pressures.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 19 March 2025
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run but uncertainty around the economic outlook has increased; the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilized at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• GDP growth forecasts were revised downward for 2025 (1.7% vs. 2.1% in the December projection) while PCE inflation projections have been adjusted slightly higher for 2025, with core inflation expected to reach 2.5%, partly due to tariff-related pressures.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and is prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of its goals.
• Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25B to $5B while maintaining the monthly redemption cap on agency debt and agency mortgage-backed securities at $35B.
• The next meeting is scheduled for 6 to 7 May 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

Federal Reserve Governor Waller’s Speech (1:35 pm GMT)

S&P Global Composite PMI (1:45 pm GMT)

What can we expect from Gold today?

Federal Reserve Governor Christopher Waller will deliver his opening remarks, along with Federal Reserve Bank of St. Louis President Alberto Musalem, at a Fed Listens event hosted by the Federal Reserve Bank of St. Louis. Given the recent ‘attack’ on the Fed, in particular Chairman Jerome Powell, by U.S. President Donald Trump, Governor Waller could be fielded with questions on the Fed’s independence and how they intend to manoeuvre around these ‘jabs’ from President Trump as the FOMC meeting in May inches closer. After which, the flash Composite PMI report for April is expected to show manufacturing activity falling into contraction once more while services output is anticipated to expand steadily, albeit at a slower pace. Should PMI activity slow more than originally forecasted, the greenback is likely to face even stronger overhead pressures, providing another lift for gold prices.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

S&P Global Composite PMI (11:00 pm GMT 22nd April)

What can we expect from AUD today?

Composite PMI activity in Australia eased slightly from 51.6 in the previous month to 51.4 in April, based on the flash report by S&P Global. This index registered its seventh successive month of expansion, fuelled by strong gains in both manufacturing and services output, as new business orders rose at the sharpest pace in three years. Service providers saw particularly strong demand, while manufacturers experienced more modest gains. The robust flash report will likely keep the Aussie elevated today.

Central Bank Notes:

• The RBA maintained the cash rate at 4.10% on 1 April, following a 25-basis point reduction on 18 February.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance.
• Recent information suggests that underlying inflation continues to ease in line with the most recent forecasts published in the February Statement on Monetary Policy.
• Private domestic demand appears to be recovering, real household incomes have picked up and there has been an easing in some measures of financial stress. However, businesses in some sectors continue to report that weakness in demand makes it difficult to pass on cost increases to final prices.
• At the same time, a range of indicators suggest that labour market conditions remain tight. Despite a decline in employment in February, measures of labour underutilisation are at relatively low rates and business surveys and liaison suggest that availability of labour is still a constraint for a range of employers. Wage pressures have eased a little more than expected but productivity growth has not picked up and growth in unit labour costs remains high.
• There are notable uncertainties about the outlook for domestic economic activity and inflation. The central projection is for growth in household consumption to continue to increase as income growth rises. But there is a risk that any pick-up in consumption is slower than expected, resulting in continued subdued output growth and a sharper deterioration in the labour market than currently expected.
• Uncertainty about the outlook abroad also remains significant. On the macroeconomic policy front, recent announcements from the U.S. on tariffs are having an impact on confidence globally and this would likely be amplified if the scope of tariffs widens, or other countries take retaliatory measures. Geopolitical uncertainties are also pronounced.
• The Board’s assessment is that monetary policy remains restrictive and the continued decline in underlying inflation is welcome, but there are nevertheless risks on both sides and the Board is cautious about the outlook.
• The Board will rely upon the data and the evolving assessment of risks to guide its decisions and is resolute in its determination to sustainably return inflation to target and will do what is necessary to achieve that outcome.
• The next meeting is on 20 May 2025.

Next 24 Hours Bias

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

After reaching as high as 0.6030 on Tuesday, the Kiwi pulled back sharply as demand for the greenback returned, aided by a tempered stance on China and the Federal Reserve by U.S. President Donald Trump. This currency pair fell under 0.5950 overnight before stabilising around 0.5960, and seen edging higher at the beginning of Tuesday’s Asia session.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 25 basis points bringing it down to 3.50% on 9 April, marking the fifth consecutive rate cut.
• The Committee assessed that annual consumer price inflation remains near the midpoint of the MPC’s 1 to 3% target band while firms’ inflation expectations and core inflation are consistent with inflation remaining at target over the medium term.
• Economic activity has evolved largely as expected since the February Monetary Policy Statement; higher-than-expected export prices and a lower exchange rate have supported primary sector incomes and overall economic growth.
• Although monetary restraint had been removed at pace, household spending and residential investment have remained weak.
• The recently announced increases in global trade barriers weaken the outlook for global economic activity. On balance, these developments create downside risks to the outlook for economic activity and inflation.
• The Committee noted that the increase in tariffs will take time to work through the global economy, but the direct price increases for economies imposing tariffs and the dampening impact of increased economic uncertainty on global demand will occur relatively quickly.
• With CPI inflation close to the mid-point of the target range, significant spare capacity in the economy, and a weaker activity outlook stemming from global trade policy, the Committee agreed that a further reduction in the OCR was appropriate.
• Meanwhile, future policy decisions will be determined by the outlook for inflationary pressure over the medium term.
• The next meeting is on 28 May 2025.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

S&P Global Composite PMI (12:30 am GMT)

What can we expect from JPY today?

Japan’s Composite PMI activity returned to expansion in April with a reading of 51.1, as business activity increased for the fifth time in six months, driven by a rebound in the service sector. Both new orders and employment grew at a faster pace, despite a renewed drop in foreign sales, highlighting an improvement in both manufacturing and services output, which could spark higher demand for the yen.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 19 March, by a unanimous vote, to maintain the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will continue its plan to reduce the amount of its monthly outright purchases of JGBs, aiming to reach about 3 trillion yen by January-March 2026.
• Japan’s economy has continued to recover moderately, with some sectors showing improvement. Exports and industrial production have remained relatively stable, while corporate profits continue on an improving trend and business sentiment maintains a favourable level.
• The employment and income situation has shown moderate improvement, with private consumption on a moderately increasing trend despite ongoing impacts from price rises.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 3.0-3.5% recently. Services prices continue to rise moderately, reflecting factors such as wage increases, while the effects of cost pass-through from past import price rises have diminished.
• Inflation expectations have continued to rise moderately, with underlying CPI inflation gradually increasing toward the price stability target of 2%. The virtuous cycle between wages and prices continues to strengthen, with businesses increasingly reflecting higher costs in selling prices.
• Japan’s economy is expected to maintain growth above its potential rate, supported by moderately growing overseas economies and the intensifying virtuous cycle from income to spending, underpinned by accommodative financial conditions.
• The next meeting is scheduled for 1 May 2025.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

S&P Global Composite PMI (8:00 am GMT)

What can we expect from EUR today?

The Composite PMI for the Euro Area climbed to 50.9 in March, exceeding market forecasts. Not only did it mark the third consecutive month of expansion, but it also was the strongest growth since last August. Overall PMI activity is now expected to slow in April, based on the flash estimates, but it should still notch another month of expansion, albeit at a softer pace.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17 April to mark the sixth successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.40%, 2.65% and 2.25% respectively.
• The disinflation process is well on track with both headline and core inflation declining in March while services inflation has also eased markedly over recent months. Most measures of underlying inflation suggest that inflation will settle at around the Governing Council’s 2% medium-term target on a sustained basis.
• Wage growth is moderating, and profits are partially buffering the impact of still elevated wage growth on inflation. The euro area economy has been building up some resilience against global shocks, but the outlook for growth has deteriorated owing to rising trade tensions.
• Increased uncertainty is likely to reduce confidence among households and firms, and the adverse and volatile market response to the trade tensions is likely to have a tightening impact on financing conditions. These factors may further weigh on the economic outlook for the euro area.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The Governing Council is determined to ensure that inflation stabilises sustainably at its 2% medium-term target. Especially in current conditions of exceptional uncertainty, it will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance.
• In particular, the Council’s interest rate decisions will be based on its assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission.
• The next meeting is on 5 June 2025.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

A tempered stance on China and the Federal Reserve by U.S. President Donald Trump calmed financial markets overnight, tapering demand for safe-haven assets such as the franc. USD/CHF rallied over 3% as it surged toward 0.8300 in early trading on Wednesday. However, overhead pressures remain for this currency pair as it hovered around 0.8220 as Asian markets came online.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points, from 0.50% to 0.25% on 20 March 2025, marking the fifth consecutive reduction.
• Underlying inflationary pressure has decreased further this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected, decreasing from 0.7% in November to 0.3% in February, primarily due to lower electricity prices.
• In the shorter term, the new conditional inflation forecast is slightly higher than December: 0.3% for Q2 2025, 0.4% for 2025 overall, and 0.8% for 2026 and 2027, based on the assumption that the SNB policy rate remains at 0.25% over the entire forecast horizon.
• GDP growth in Switzerland remains moderate, with the services sector continuing to show slightly stronger growth, while manufacturing faces challenges.
• The SNB anticipates GDP growth of around 1.0% to 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 19 June 2025.

Next 24 Hours Bias

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Composite PMI (8:30 am GMT)

What can we expect from GBP today?

Composite PMI activity in the U.K. rebounded in March, rising from 50.5 in the previous month to 51.5. It marked the fastest growth since last October, driven primarily by a pickup in services output. However, overall PMI output for April is anticipated to slow in April, based on the flash estimates, which could create temporary headwinds for Cable before the start of the European trading hours.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to maintain the Bank Rate at 4.50% on 19 March 2025, while one member preferred to reduce it by 25 basis points (bps).
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• Twelve-month CPI inflation increased to 3.0% in January from 2.5% in December, slightly higher than expected in the February Report; domestic price and wage pressures are moderating, but remain somewhat elevated.
• Although global energy prices have fallen back recently, they remain higher than last year and CPI inflation is still projected to rise to around 3.75% in 2025 Q3. While CPI inflation is expected to fall back thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• While UK GDP growth estimates have been slightly stronger than expected at the time of the February Monetary Policy Report, business survey indicators generally continue to suggest weakness in growth and particularly in employment intentions. In recent quarters, subdued activity has been judged to reflect both demand and supply factors.
• The labour market had continued to ease, although it was still judged to be broadly in balance – some indicators of employment intentions had deteriorated markedly, to levels consistent with shrinking employment while other indicators, such as the number of vacancies, had not weakened to the same extent.
• Domestic price and wage pressures were moderating, but remained somewhat elevated. A range of indicators suggested that underlying pay growth had eased further in recent months, although annual growth in private sector regular average weekly earnings had picked up to 6.1% in the three months to January.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 8 May 2025.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Demand for the Loonie remains robust as USD/CAD fell under 1.3800 once more. However, this currency pair recovered to climb above this level at the beginning of Wednesday’s Asia session, edging toward 1.3850.

Central Bank Notes:

• The Bank of Canada today maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70% – marking the first pause after seven consecutive meetings where rates were reduced.
• The major shift in direction of U.S. trade policy and the unpredictability of tariffs have increased uncertainty, diminished prospects for economic growth, and raised inflation expectations.
• Pervasive uncertainty makes it unusually challenging to project GDP growth and inflation in Canada and globally – the April Monetary Policy Report (MPR) presents two scenarios that explore different paths for US trade policy.
• In the first scenario, uncertainty is high but tariffs are limited in scope –  Canadian growth weakens temporarily and inflation remains around the 2% target. In the second scenario, a protracted trade war causes Canada’s economy to fall into recession this year and inflation rises temporarily above 3% next year.
• Global economic growth was solid in late 2024 and inflation has been easing towards central bank targets. However, tariffs and uncertainty have weakened the outlook. In the U.S., the economy is showing signs of slowing amid rising policy uncertainty and rapidly deteriorating sentiment, while inflation expectations have risen. In the Euro Area, growth has been modest in early 2025, with continued weakness in the manufacturing sector. China’s economy was strong at the end of 2024 but more recent data shows it slowing modestly.
• In Canada, the economy is slowing as tariff announcements and uncertainty pull down consumer and business confidence. Consumption, residential investment and business spending all look to have weakened in the first quarter. Trade tensions are also disrupting recovery in the labour market. Employment declined in March and businesses are reporting plans to slow their hiring. Wage growth continues to show signs of moderation.
• The Governing Council will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs while proceeding carefully, with particular attention to the risks and uncertainties facing the Canadian economy.
• Monetary policy cannot resolve trade uncertainty or offset the impacts of a trade war and the Governing Council will focus on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval by supporting economic growth while ensuring that inflation remains well-controlled.
• The next meeting is on 4 June 2025.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

EIA Crude Oil Inventories (2:30 pm GMT)

What can we expect from Oil today?

Oil prices rallied strongly on Tuesday as a fresh round of U.S. sanctions imposed on Iran raised supply risks from this major oil producer. The sanctions targeted Iranian liquefied petroleum gas and crude oil shipping magnate, Seyed Asadoollah Emamjomeh and his corporate network. Emamjomeh’s network is responsible for shipping hundreds of millions of dollars’ worth of Iranian LPG and crude oil to foreign markets, as stated in a statement issued by the U.S. Treasury department. Coupled with a strong draw of 4.6M barrels of crude in the API stockpiles, WTI oil rallied over 3% at its highest point, rising above the $64 mark. This benchmark remained elevated as Asian markets came online on Wednesday, hovering around $64.50 per barrel. Should the EIA inventories also register a sizable drawdown, it could function as an additional bullish catalyst for this commodity.

Next 24 Hours Bias

Medium Bullish

The post IC Markets Europe Fundamental Forecast | 23 April 2025 first appeared on IC Markets | Official Blog.

The big news as we get into European trading is none other than more Trump headlines. This time around, it looks like he has toned down his brazen stance on trade a little but definitely more so when it comes to firing Fed chair Powell. Let’s take a look at his full remarks on both matters.

On China, he said that:

“I’m not going to mention Covid. I’m not gonna say “Oh, I’m gonna play hardball with China, I’m gonna play hardball with you president Xi”. No. We’re going to be very nice. They’re going to be very nice. And we’ll see what happens. But ultimately, they have to make a deal because otherwise they’re not going to be able to deal in the US. And we want them involved but they and other countries will have to make a deal.

And if they don’t make a deal, we’ll set the deal. We’re going to be setting the deal and it will be a fair deal for everybody and I think it’s a process that is going to go pretty quickly. We’ve spoken to many, many countries and we’re getting their views on things. And you know, there are a lot of things. They have VAT taxes and everything you can have. Don’t forget as an example that the EU was set up to take advantage of the US. They’ve done that but they’re not doing that anymore.”

“145% (tariffs) is very high and it won’t be that high. It got up to there when we were talking about fentanyl and various elements built it up to 145% but no, it won’t be anywhere near that high. It will come down substantially but it won’t be zero. It used to be zero.

We just destroyed China who is taking us for a ride and it’s not gonna happen. We’re going to be very good to China. I have a great relationship with president Xi. I think we’re gonna live together very happily and ideally work together. I think it’s going to work out very well. But no, it’s not going to be 145%. They will not be anywhere near that number.”

“My relationship with president Xi is great. It’s been great for a long time. We have a very good relationship. And I think we’ll make a deal with China. If we don’t make a deal, we’ll set it. We’ll just set the number. I think they’ll want to be a part of the US. We’re doing great. This is the Golden Age. There will never be a time like this in my opinion. And China wants to be a part of that too.”

The final passage was what he answered on whether or not he had spoken to Xi. That’s definitely a no and confirms that both sides are still unwilling to pick up the phone.

As much as it is optimistic to see him answer deliver a more composed response, there’s always two sides to the coin in reading into these situations. We’ve seen many a time before how Trump says one thing but the direct counterpart says another. And China is no stranger to that sort of rhetoric.

In any case, the status quo remains rather unwelcome the longer it stays. At these tariff levels, it has definitely stifled US-China trade until further notice. And something’s gotta give before the hard data really shows up and starts to bite at the hopeful optimism.

The next part in all this now will be to watch for the Chinese response later today.

As for Fed chair Powell, Trump said that:

“The Fed should lower the rates. We think that it’s a perfect time to lower rates and would like to see our Chairman be early or on time as opposed to late. Late is not good.

(Are you going to fire Mr. Powell?)

I don’t want to talk about that. Because I have no intention of firing him.

(What about reports on you studying the idea of possibly removing Powell? Do you have any plans on doing that?)

None whatsoever. Never did. The press runs away with things. I have no intention of firing him. I would like to see him be a little more active in terms of his idea to lower interest rates. It’s the perfect time to lower interest rates. If he doesn’t, is it the end? No, it’s not. But it would be good timing and it should’ve taken place earlier. But no, I have no intention to fire him.”

As a reminder, Trump said last week that Powell’s “termination can’t come soon enough”. Geez.

Whatever the case is, the erratic stance is playing in favour of US assets this time around and kept the bounce from early yesterday.

30-year yields are now down to 4.80% and equity futures are surging as a result, with S&P 500 futures up another 1.5% after the 2.5% gains overnight.

As for the dollar, it is also seen rebounding with USD/JPY back up to 141.94 currently with the high earlier clipping above the 143.00 mark. For some context, the pair tested the 140.00 mark in trading yesterday. Meanwhile, EUR/USD backs away from 1.1500 to hold at 1.1385 ahead of European trading later.

It’s a bit of a respite at least, until we get back up on the merry-go-round again.

This article was written by Justin Low at www.forexlive.com.

DXY (US Dollar Index):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 100.21

Supporting reasons: Identified as a swing-high resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 98.01

Supporting reasons: Identified as a swing-low support, indicating a potential area where the price could stabilize once again.

1st resistance: 101.39
Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential level that could cap further upward movement.

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 1.1276

Supporting reasons: Identified as a multi-swing-low support that aligns close to the 38.2% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 1.1089
Supporting reasons: Identified as a pullback support that aligns close to the 61.8% Fibonacci retracement, indicating a potential area where the price could stabilize once more.

1st resistance: 1.1556
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

EUR/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 161.03

Supporting reasons: Identified as a multi-swing-low support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 159.68
Supporting reasons: Identified as a swing-low support, indicating a potential area where the price could stabilize once again.

1st resistance: 163.16
Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area that could halt any further upward movement.

EUR/GBP:

Potential Direction: Bullish
Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance. 

Pivot: 0.8526

Supporting reasons: Identified as a multi-swing-low support that aligns with the 50% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 0.8447
Supporting reasons: Identified as a pullback support, indicating a potential area where the price could stabilize once more.

1st resistance: 0.8615
Supporting reasons: Identified as a multi-swing-high resistance that aligns close to the 50% Fibonacci retracement, indicating a potential level that could cap further upward movement.

GBP/USD:

Potential Direction:  Bullish

Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 1.3207

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 1.3050
Supporting reasons: Identified as a swing-low support that aligns close to the 50% Fibonacci retracement, acting as a potential level where the price could stabilize once again.

1st resistance: 1.3416
Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 187.25

Supporting reasons: Identified as a swing-low support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 184.90

Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 189.82
Supporting reasons: Identified as a multi-swing-high resistance that aligns close to a 50% Fibonacci retracement, indicating a potential level that could cap further upward movement.

USD/CHF:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 0.8373

Supporting reasons: Identified as a pullback resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 0.8051
Supporting reasons: Identified as a swing low support, indicating a potential level where the price could stabilize once again.

1st resistance: 0.8576
Supporting reasons: Identified as a swing-high resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential level that could cap further upward movement.

USD/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 143.88

Supporting reasons: Identified as a swing-high resistance that aligns close to a 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 140.19
Supporting reasons: Identified as a swing-low support, suggesting a potential area where the price could stabilize once more.

1st resistance: 145.41
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 1.3974

Supporting reasons: Identified as a swing-high resistance that aligns with a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum. 

1st support: 1.3790
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 1.4063
Supporting reasons: Identified as a pullback resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 0.6340
Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 0.6237

Supporting reasons: Identified as an overlap support that aligns with a 38.2% Fibonacci retracement, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6430
Supporting reasons: Identified as a multi-swing-high, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 0.5887
Supporting reasons: Identified as an overlap support that aligns close to a 23.6% Fibonacci retracement, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 0.5828

Supporting reasons: Identified as an overlap support that aligns close to a 38.2% Fibonacci retracement, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.6019

Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bullish
Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 39,318.40

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 36,937.99

Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 40,824.20

Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bullish
Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 21,505.00
Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 20,358.00

Supporting reasons: Identified as an overlap support, indicating a key level where the price could stabilize once more.

1st resistance: 22,723.90
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bearish
Overall momentum of the chart: Neutral

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 5,480.90

Supporting reasons: Identified as a swing-high resistance that aligns with a 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 5,099.50

Supporting reasons: Identified as a swing-low support that aligns close to a 61.8% Fibonacci retracement, indicating a potential level where the price could stabilize once again.

1st resistance: 5,778.60

Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction:  Bullish

Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 92,468.39
Supporting reasons:  Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 88,428.80
Supporting reasons: Identified as a pullback support, indicating a potential level where the price could stabilize once more.

1st resistance: 99,293.10
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 1,765.71
Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound. 

1st support: 1,669.20
Supporting reasons: Identified as pullback support, indicating a potential level where the price could stabilize once again.

1st resistance: 1,913.71
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price could rise toward the pivot and potentially make a bearish reversal off this level to fall toward the 1st support.

Pivot: 65.66

Supporting reasons: Identified as a pullback resistance that aligns with a 61.8 Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 58.85
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 68.75
Supporting reasons: Identified as an overlap resistance that aligns close to a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 3,309.53

Supporting reasons: Identified as a swing-low support that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 3,240.63
Supporting reasons: Identified as a pullback support that aligns close to a 50% Fibonacci retracement, acting as a potential level where price could stabilize once again.

1st resistance: 3,490.02
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

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The post Wednesday 23rd April 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 23 April 2025

What happened in the U.S. session?

After falling to -4 in March, the Richmond manufacturing index plummeted to -13 in April, exceeding the forecast of -6 by a wide margin. The severe deterioration in manufacturing activity was mainly attributed to the ongoing tariff escalation and uncertainty between the U.S. and its major trading partners. However, a tempered stance on China and the Federal Reserve by U.S. President Donald Trump calmed financial markets overnight. President Trump backtracked on some of his criticism of Fed Chairman Jerome Powell, claiming that he did not intend to fire him, while also presenting a less hawkish stance on China, stating that the high tariffs on China will come down substantially, but they will not be completely removed. The greenback saw relatively strong bids as the dollar index (DXY) rallied more than 1.3%, surging from 98 to as high as 99.65.

What does it mean for the Asia Session?

Composite PMI activity in Australia eased slightly from 51.6 in the previous month to 51.4 in April, based on the flash report by S&P Global. This index registered its seventh successive month of expansion, fuelled by strong gains in both manufacturing and services output, as new business orders rose at the sharpest pace in three years. Service providers saw particularly strong demand, while manufacturers experienced more modest gains. The robust flash report will likely keep the Aussie elevated today. 

Meanwhile, Japan’s Composite PMI activity returned to expansion in April with a reading of 51.1, as business activity increased for the fifth time in six months, driven by a rebound in the service sector. Both new orders and employment grew at a faster pace, despite a renewed drop in foreign sales, highlighting an improvement in both manufacturing and services output, which could spark higher demand for the yen.

The Dollar Index (DXY)

Key news events today

Federal Reserve Governor Waller’s Speech (1:35 pm GMT)

S&P Global Composite PMI (1:45 pm GMT)

What can we expect from DXY today?

Federal Reserve Governor Christopher Waller will deliver his opening remarks, along with Federal Reserve Bank of St. Louis President Alberto Musalem, at a Fed Listens event hosted by the Federal Reserve Bank of St. Louis. Given the recent ‘attack’ on the Fed, in particular Chairman Jerome Powell, by U.S. President Donald Trump, Governor Waller could be fielded with questions on the Fed’s independence and how they intend to manoeuvre around these ‘jabs’ from President Trump as the FOMC meeting in May inches closer. After which, the flash Composite PMI report for April is expected to show manufacturing activity falling into contraction once more while services output is anticipated to expand steadily, albeit at a slower pace. Should PMI activity slow more than originally forecasted, the greenback is likely to face even stronger overhead pressures.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 19 March 2025
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run but uncertainty around the economic outlook has increased; the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilized at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• GDP growth forecasts were revised downward for 2025 (1.7% vs. 2.1% in the December projection) while PCE inflation projections have been adjusted slightly higher for 2025, with core inflation expected to reach 2.5%, partly due to tariff-related pressures.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and is prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of its goals.
• Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25B to $5B while maintaining the monthly redemption cap on agency debt and agency mortgage-backed securities at $35B.
• The next meeting is scheduled for 6 to 7 May 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

Federal Reserve Governor Waller’s Speech (1:35 pm GMT)

S&P Global Composite PMI (1:45 pm GMT)

What can we expect from Gold today?

Federal Reserve Governor Christopher Waller will deliver his opening remarks, along with Federal Reserve Bank of St. Louis President Alberto Musalem, at a Fed Listens event hosted by the Federal Reserve Bank of St. Louis. Given the recent ‘attack’ on the Fed, in particular Chairman Jerome Powell, by U.S. President Donald Trump, Governor Waller could be fielded with questions on the Fed’s independence and how they intend to manoeuvre around these ‘jabs’ from President Trump as the FOMC meeting in May inches closer. After which, the flash Composite PMI report for April is expected to show manufacturing activity falling into contraction once more while services output is anticipated to expand steadily, albeit at a slower pace. Should PMI activity slow more than originally forecasted, the greenback is likely to face even stronger overhead pressures, providing another lift for gold prices.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

S&P Global Composite PMI (11:00 pm GMT 22nd April)

What can we expect from AUD today?

Composite PMI activity in Australia eased slightly from 51.6 in the previous month to 51.4 in April, based on the flash report by S&P Global. This index registered its seventh successive month of expansion, fuelled by strong gains in both manufacturing and services output, as new business orders rose at the sharpest pace in three years. Service providers saw particularly strong demand, while manufacturers experienced more modest gains. The robust flash report will likely keep the Aussie elevated today.

Central Bank Notes:

• The RBA maintained the cash rate at 4.10% on 1 April, following a 25-basis point reduction on 18 February.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance.
• Recent information suggests that underlying inflation continues to ease in line with the most recent forecasts published in the February Statement on Monetary Policy.
• Private domestic demand appears to be recovering, real household incomes have picked up and there has been an easing in some measures of financial stress. However, businesses in some sectors continue to report that weakness in demand makes it difficult to pass on cost increases to final prices.
• At the same time, a range of indicators suggest that labour market conditions remain tight. Despite a decline in employment in February, measures of labour underutilisation are at relatively low rates and business surveys and liaison suggest that availability of labour is still a constraint for a range of employers. Wage pressures have eased a little more than expected but productivity growth has not picked up and growth in unit labour costs remains high.
• There are notable uncertainties about the outlook for domestic economic activity and inflation. The central projection is for growth in household consumption to continue to increase as income growth rises. But there is a risk that any pick-up in consumption is slower than expected, resulting in continued subdued output growth and a sharper deterioration in the labour market than currently expected.
• Uncertainty about the outlook abroad also remains significant. On the macroeconomic policy front, recent announcements from the U.S. on tariffs are having an impact on confidence globally and this would likely be amplified if the scope of tariffs widens, or other countries take retaliatory measures. Geopolitical uncertainties are also pronounced.
• The Board’s assessment is that monetary policy remains restrictive and the continued decline in underlying inflation is welcome, but there are nevertheless risks on both sides and the Board is cautious about the outlook.
• The Board will rely upon the data and the evolving assessment of risks to guide its decisions and is resolute in its determination to sustainably return inflation to target and will do what is necessary to achieve that outcome.
• The next meeting is on 20 May 2025.

Next 24 Hours Bias

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

After reaching as high as 0.6030 on Tuesday, the Kiwi pulled back sharply as demand for the greenback returned, aided by a tempered stance on China and the Federal Reserve by U.S. President Donald Trump. This currency pair fell under 0.5950 overnight before stabilising around 0.5960, and seen edging higher at the beginning of Tuesday’s Asia session.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 25 basis points bringing it down to 3.50% on 9 April, marking the fifth consecutive rate cut.
• The Committee assessed that annual consumer price inflation remains near the midpoint of the MPC’s 1 to 3% target band while firms’ inflation expectations and core inflation are consistent with inflation remaining at target over the medium term.
• Economic activity has evolved largely as expected since the February Monetary Policy Statement; higher-than-expected export prices and a lower exchange rate have supported primary sector incomes and overall economic growth.
• Although monetary restraint had been removed at pace, household spending and residential investment have remained weak.
• The recently announced increases in global trade barriers weaken the outlook for global economic activity. On balance, these developments create downside risks to the outlook for economic activity and inflation.
• The Committee noted that the increase in tariffs will take time to work through the global economy, but the direct price increases for economies imposing tariffs and the dampening impact of increased economic uncertainty on global demand will occur relatively quickly.
• With CPI inflation close to the mid-point of the target range, significant spare capacity in the economy, and a weaker activity outlook stemming from global trade policy, the Committee agreed that a further reduction in the OCR was appropriate.
• Meanwhile, future policy decisions will be determined by the outlook for inflationary pressure over the medium term.
• The next meeting is on 28 May 2025.

Next 24 Hours Bias

Medium Bullish

The Japanese Yen (JPY)

Key news events today

S&P Global Composite PMI (12:30 am GMT)

What can we expect from JPY today?

Japan’s Composite PMI activity returned to expansion in April with a reading of 51.1, as business activity increased for the fifth time in six months, driven by a rebound in the service sector. Both new orders and employment grew at a faster pace, despite a renewed drop in foreign sales, highlighting an improvement in both manufacturing and services output, which could spark higher demand for the yen.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 19 March, by a unanimous vote, to maintain the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will continue its plan to reduce the amount of its monthly outright purchases of JGBs, aiming to reach about 3 trillion yen by January-March 2026.
• Japan’s economy has continued to recover moderately, with some sectors showing improvement. Exports and industrial production have remained relatively stable, while corporate profits continue on an improving trend and business sentiment maintains a favourable level.
• The employment and income situation has shown moderate improvement, with private consumption on a moderately increasing trend despite ongoing impacts from price rises.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 3.0-3.5% recently. Services prices continue to rise moderately, reflecting factors such as wage increases, while the effects of cost pass-through from past import price rises have diminished.
• Inflation expectations have continued to rise moderately, with underlying CPI inflation gradually increasing toward the price stability target of 2%. The virtuous cycle between wages and prices continues to strengthen, with businesses increasingly reflecting higher costs in selling prices.
• Japan’s economy is expected to maintain growth above its potential rate, supported by moderately growing overseas economies and the intensifying virtuous cycle from income to spending, underpinned by accommodative financial conditions.
• The next meeting is scheduled for 1 May 2025.

Next 24 Hours Bias

Weak Bearish

The Euro (EUR)

Key news events today

S&P Global Composite PMI (8:00 am GMT)

What can we expect from EUR today?

The Composite PMI for the Euro Area climbed to 50.9 in March, exceeding market forecasts. Not only did it mark the third consecutive month of expansion, but it also was the strongest growth since last August. Overall PMI activity is now expected to slow in April, based on the flash estimates, but it should still notch another month of expansion, albeit at a softer pace.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 17 April to mark the sixth successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.40%, 2.65% and 2.25% respectively.
• The disinflation process is well on track with both headline and core inflation declining in March while services inflation has also eased markedly over recent months. Most measures of underlying inflation suggest that inflation will settle at around the Governing Council’s 2% medium-term target on a sustained basis.
• Wage growth is moderating, and profits are partially buffering the impact of still elevated wage growth on inflation. The euro area economy has been building up some resilience against global shocks, but the outlook for growth has deteriorated owing to rising trade tensions.
• Increased uncertainty is likely to reduce confidence among households and firms, and the adverse and volatile market response to the trade tensions is likely to have a tightening impact on financing conditions. These factors may further weigh on the economic outlook for the euro area.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The Governing Council is determined to ensure that inflation stabilises sustainably at its 2% medium-term target. Especially in current conditions of exceptional uncertainty, it will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance.
• In particular, the Council’s interest rate decisions will be based on its assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission.
• The next meeting is on 5 June 2025.

Next 24 Hours Bias

Weak Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

A tempered stance on China and the Federal Reserve by U.S. President Donald Trump calmed financial markets overnight, tapering demand for safe-haven assets such as the franc. USD/CHF rallied over 3% as it surged toward 0.8300 in early trading on Wednesday. However, overhead pressures remain for this currency pair as it hovered around 0.8220 as Asian markets came online.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points, from 0.50% to 0.25% on 20 March 2025, marking the fifth consecutive reduction.
• Underlying inflationary pressure has decreased further this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected, decreasing from 0.7% in November to 0.3% in February, primarily due to lower electricity prices.
• In the shorter term, the new conditional inflation forecast is slightly higher than December: 0.3% for Q2 2025, 0.4% for 2025 overall, and 0.8% for 2026 and 2027, based on the assumption that the SNB policy rate remains at 0.25% over the entire forecast horizon.
• GDP growth in Switzerland remains moderate, with the services sector continuing to show slightly stronger growth, while manufacturing faces challenges.
• The SNB anticipates GDP growth of around 1.0% to 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 19 June 2025.

Next 24 Hours Bias

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Composite PMI (8:30 am GMT)

What can we expect from GBP today?

Composite PMI activity in the U.K. rebounded in March, rising from 50.5 in the previous month to 51.5. It marked the fastest growth since last October, driven primarily by a pickup in services output. However, overall PMI output for April is anticipated to slow in April, based on the flash estimates, which could create temporary headwinds for Cable before the start of the European trading hours.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to maintain the Bank Rate at 4.50% on 19 March 2025, while one member preferred to reduce it by 25 basis points (bps).
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• Twelve-month CPI inflation increased to 3.0% in January from 2.5% in December, slightly higher than expected in the February Report; domestic price and wage pressures are moderating, but remain somewhat elevated.
• Although global energy prices have fallen back recently, they remain higher than last year and CPI inflation is still projected to rise to around 3.75% in 2025 Q3. While CPI inflation is expected to fall back thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• While UK GDP growth estimates have been slightly stronger than expected at the time of the February Monetary Policy Report, business survey indicators generally continue to suggest weakness in growth and particularly in employment intentions. In recent quarters, subdued activity has been judged to reflect both demand and supply factors.
• The labour market had continued to ease, although it was still judged to be broadly in balance – some indicators of employment intentions had deteriorated markedly, to levels consistent with shrinking employment while other indicators, such as the number of vacancies, had not weakened to the same extent.
• Domestic price and wage pressures were moderating, but remained somewhat elevated. A range of indicators suggested that underlying pay growth had eased further in recent months, although annual growth in private sector regular average weekly earnings had picked up to 6.1% in the three months to January.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 8 May 2025.

Next 24 Hours Bias

Weak Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Demand for the Loonie remains robust as USD/CAD fell under 1.3800 once more. However, this currency pair recovered to climb above this level at the beginning of Wednesday’s Asia session, edging toward 1.3850.

Central Bank Notes:

• The Bank of Canada today maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70% – marking the first pause after seven consecutive meetings where rates were reduced.
• The major shift in direction of U.S. trade policy and the unpredictability of tariffs have increased uncertainty, diminished prospects for economic growth, and raised inflation expectations.
• Pervasive uncertainty makes it unusually challenging to project GDP growth and inflation in Canada and globally – the April Monetary Policy Report (MPR) presents two scenarios that explore different paths for US trade policy.
• In the first scenario, uncertainty is high but tariffs are limited in scope –  Canadian growth weakens temporarily and inflation remains around the 2% target. In the second scenario, a protracted trade war causes Canada’s economy to fall into recession this year and inflation rises temporarily above 3% next year.
• Global economic growth was solid in late 2024 and inflation has been easing towards central bank targets. However, tariffs and uncertainty have weakened the outlook. In the U.S., the economy is showing signs of slowing amid rising policy uncertainty and rapidly deteriorating sentiment, while inflation expectations have risen. In the Euro Area, growth has been modest in early 2025, with continued weakness in the manufacturing sector. China’s economy was strong at the end of 2024 but more recent data shows it slowing modestly.
• In Canada, the economy is slowing as tariff announcements and uncertainty pull down consumer and business confidence. Consumption, residential investment and business spending all look to have weakened in the first quarter. Trade tensions are also disrupting recovery in the labour market. Employment declined in March and businesses are reporting plans to slow their hiring. Wage growth continues to show signs of moderation.
• The Governing Council will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs while proceeding carefully, with particular attention to the risks and uncertainties facing the Canadian economy.
• Monetary policy cannot resolve trade uncertainty or offset the impacts of a trade war and the Governing Council will focus on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval by supporting economic growth while ensuring that inflation remains well-controlled.
• The next meeting is on 4 June 2025.

Next 24 Hours Bias

Weak Bearish

Oil

Key news events today

EIA Crude Oil Inventories (2:30 pm GMT)

What can we expect from Oil today?

Oil prices rallied strongly on Tuesday as a fresh round of U.S. sanctions imposed on Iran raised supply risks from this major oil producer. The sanctions targeted Iranian liquefied petroleum gas and crude oil shipping magnate, Seyed Asadoollah Emamjomeh and his corporate network. Emamjomeh’s network is responsible for shipping hundreds of millions of dollars’ worth of Iranian LPG and crude oil to foreign markets, as stated in a statement issued by the U.S. Treasury department. Coupled with a strong draw of 4.6M barrels of crude in the API stockpiles, WTI oil rallied over 3% at its highest point, rising above the $64 mark. This benchmark remained elevated as Asian markets came online on Wednesday, hovering around $64.50 per barrel. Should the EIA inventories also register a sizable drawdown, it could function as an additional bullish catalyst for this commodity.

Next 24 Hours Bias

Medium Bullish

The post IC Markets Asia Fundamental Forecast | 23 April 2025 first appeared on IC Markets | Official Blog.

US Stocks Rally on Trade Optimism – Nasdaq up 2.8%

US stocks rallied in trading yesterday to notch up their best day in two weeks as trade deal optimism swept the market. The Nasdaq led the way higher, closing the day up 2.77%, erasing a similar loss from the day before, while the S&P gained 2.51% and the Dow rose 2.66%. The dollar also managed a good rally, with the DXY up 0.71% to 98.99, while haven currencies—the yen and Swiss franc—took big hits. US Treasury yields were mixed after Donald Trump advised that he has no intention of firing Jerome Powell. The 2-year was up 5.4 basis points to 3.817%, while the 10-year slid 1.2 basis points to 4.399%. Oil prices rallied as US sanctions hit Iran, with Brent up 1.55% to $67.29 and WTI up 1.76% to $63.49. Gold had a big day, initially rallying to another record level at $3,500 before crashing in later sessions to ultimately finish down 1.19% on the day at $3,380.41 an ounce.

Start of a Haven Unwind??

Some traders are asking if we are about to see a strong run of haven trades unwinding in the next few days as trade deal optimism sweeps the market, or if last night’s moves are just a brief flicker of silver lining in the clouds of a longer-running trade war. Major haven trades—gold, yen, and Swiss franc—all saw big moves last night, and traders are now looking to see if a top has been put in place or if these moves are just going to give us better levels to buy. Gold has rallied over 18% in the face of tariff announcements this month, while USDJPY sank 7% and USDCHF dropped over 9%. We have just seen some good relief rallies from risk in all these products—gold down 1.2% on the day and nearly 5% from its record high, with USDJPY and USDCHF up 2.4% and 2.8% respectively from their recent lows. The next 24 hours could be crucial for all these products, with any updates from affected parties likely to see equally big moves in either direction.

Macroeconomic Calendar in Focus Today

Geopolitical updates continue to dominate market moves in the current environment, but traders will see a focus move back to underlying fundamentals today as the macroeconomic calendar picks up after a quiet few days. The Asian session is expected to start on the front foot after a strong surge on Wall Street overnight, and there is little on the event calendar to disturb that momentum. However, a raft of Flash PMI numbers across the rest of the trading day will have investors analyzing data to see what damage tariffs have done to purchasing managers’ confidence. We have Flash Services and Manufacturing data due out from Australia, France, Germany, the EU, the UK, and the US, as well as New Home Sales numbers in the States. With several central bankers set to speak, including the Fed’s Goolsbee and Waller, as well as Bank of England Governor Andrew Bailey, we could be in for another lively day’s trading.

The post General Market Analysis – 23/04/25 first appeared on IC Markets | Official Blog.

• Federal Reserve speakers on Wednesday include Goolsbee, Waller, Hammack and Musalem
• Shanghai Gold exchange has increased the trade margin for some gold futures contracts
• Learn Invesgting: Liquidity Ratios
• Japan economy minister Akazawa could visit U.S. for tariff talks as early as April 30
• ECB’s Lane, Knot, and Cipollone speaking on Wednesday, April 23, 2025
• BMW will integrate DeepSeek’s AI into its new vehicles sold in China from late 2025.
• Learn to Invest: Stock Valuation
• USD retracing its earlier Trump comments gains, equity indexes not so much
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• Bank of England speakers Wednesday include governor Bailey, Pill, Breeden
• Learn Investing: Link the 3 Important Financial Statements
• PBOC sets USD/ CNY mid-point today at 7.2116 (vs. estimate at 7.3466)
• Intel is set to announce plans to cut more than 20% of its staff
• ECB’s Villeroy warns that Trump’s trade policies will weaken financial stability & growth
• Japan flash April manufacturing PMI 48.5 (prior 48.4)
• JP Morgan forecast gold prices above US$4K by Q2 2026
• Trump and Xi to meet in early May
• Trump’s China reversal – now we await China’s response (if any)
• Australian S&P Global Manufacturing PMI Flash reading for April 2025: 51.7 (prior 52.1)
• More from Fed’s Kugler: Facing potential shocks, mainly from tariffs and uncertainty
• Trump said had no intention of firing Fed Chair Powell (he did). Major reversal from Trump
• US to push the UK to lower its tariffs on autos, relax ag rules
• ICYMI: Citi says tariffs a stagflationary shock to US economy, 40-45% chance of recession
• EUR, JPY, GBP down vs. USD. AUD, NZD, CAD too. Trump cave in on pet issues cited.
• Fed’s Kugler says higher than expected tariffs likely to send prices higher
• Tesla CEO Musk says time he spends on DOGE will drop significantly from May
• Trump backing away from tariffs, backing away from firing Powell – will it last?
• Trump says he has no plans to Fire Federal Reserve Chair Powell
• Trump says he is going to be very nice to China, they have to make a deal
• North American Forexlive Americas FX news wrap 22 Apr: Sell US shifts to Buy US today.
• IMF Managing Director Georgieva: Biggest priority is to resolve trade tensions
• Oil: private survey of inventory shows a much bigger headline crude oil draw than expected
• Shares suspended in FX risk management firm – now in talks about emergency sale to a rival
• Trade ideas thread – Wednesday, 23 April, insightful charts, technical analysis, ideas
• Tesla earnings: Revenue of $19.335B vs $21.111B expected

The big swings after the US close began with Trump striking a markedly softer tone on China, telling reporters that the U.S. is “doing fine” with Beijing and that he would be “very nice” in any trade talks. Still, he warned that if no agreement is reached, Washington will dictate terms — a statement that underscores this is a pause, not a pivot.

More significantly, Trump also signalled a commitment to Fed independence, stating explicitly that he does not intend to fire Chair Jerome Powell. This immediately buoyed markets, easing recent fears over institutional and financial stability.

After a strong rally during the US Tuesday session, equities extended gains following Trump’s comments on Powell. The US dollar also strengthened: EUR/USD dropped below 1.1320 and USD/JPY surged past 143.00. Gold prices continued their retreat.

Still, caution lingers. As one market strategist noted, “a sudden rhetorical shift is not a policy pivot.” Attention now turns to Beijing, with markets watching closely for any response to Washington’s apparent softening — or its absence.

As liquidity returned, the dollar reversed course. EUR/USD and USD/JPY fully retraced their moves, while AUD/USD and NZD/USD are now higher than levels seen before Trump’s remarks. US equity index futures are holding on to most — though not all — of their gains.

Gold also rebounded from its earlier lows, before coming under renewed pressure in the past hour on news that the Shanghai Gold Exchange has increased the trade margin for some gold futures contracts to 13% from 12%.

Tesla made headlines after reporting a 71% plunge in quarterly profits, with underlying operations swinging to a loss once EV credits and one-off items were stripped out. Analysts flagged growing reputational risks, particularly related to CEO Elon Musk’s high-profile involvement in the Trump administration. Musk said he plans to significantly scale back his time on the “DOGE” initiative in the coming month, though the implications for broader sentiment around the brand remain unclear.

This article was written by Eamonn Sheridan at www.forexlive.com.

Shanghai Gold exchange has increased the trade margin for some gold futures contracts

Not bullish

This article was written by Eamonn Sheridan at www.forexlive.com.

Japan economy minister Akazawa could visit U.S. for tariff talks as early as April 30, TV Asahi reports

Thats him the hat

This article was written by Eamonn Sheridan at www.forexlive.com.

BMW will integrate Chinese startup DeepSeek’s AI into its new vehicles sold in China from late 2025.

• The move aims to enhance in-car intelligence and user experience for local consumers.

• It reflects BMW’s broader strategy of partnering with regional tech firms to align with China’s innovation ecosystem.

• AI is viewed as key to driving future vehicle innovation and global competitiveness.

• The announcement was made at the Shanghai Auto Show.

This article was written by Eamonn Sheridan at www.forexlive.com.

Japan Jibun Bank PMI Manufacturing April 2025 Preliminary

• prior 48.4

Services 52.2

• prior 50.0

more to come

Composite 51.1

• prior 48.9

This article was written by Eamonn Sheridan at www.forexlive.com.

Reuters convey the info from a JP Morgan note:

• forecast gold prices above US$4,000 per ounce by 2026
• average $3,675/oz by 4Q25
• risks skewed towards an earlier overshoot of these forecasts if demand surpasses its expectations
• “Underpinning our forecast for gold prices heading towards $4,000/oz next year is continued strong investor and central bank gold demand averaging around 710 tonnes a quarter on net this year,”
• an unexpected drop off in central bank demand remains the biggest fundamental risk

This article was written by Eamonn Sheridan at www.forexlive.com.