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Beyonce is on tour but no one seems to care. The tickets are going for $25 and there are plenty of empty seats.

At some point, people don’t want to see the same old song and dance anymore.

That’s increasingly the case with Trump’s trade team talking up trade deals that never seem to materialize. Hassett said on Thursday that a deal was coming later that day and we’re still waiting.

Now Bessent is playing the classics again:

• Many trading partners have approached us with very good offers
• US negotiating with 17 trading partners
• Have not engaged with China yet

The market rallied for 9 days in a row on the hope/expectation that Trump would start to announce trade deals but the clock keeps ticking and yesterday we learned that the US isn’t going to offer zero tariffs, at least to Japan.

The US dollar is sagging today and gold is up $51 in a troubling potential return of the early-April paradigm.

This article was written by Adam Button at www.forexlive.com.

• Prior was 51.3
• Non-seasonally adjusted 52.3 vs 55.6 prior

This is a poor economic indicator but there is no doubt that the Canadian economy is feeling the tariff war, among other things.

This article was written by Adam Button at www.forexlive.com.

Oil has closed the opening gap for the week and is now up $2.01 to $59.13. It’s an unlikely rebound after OPEC+ added barrels once again on the weekend and a leak said they will continue to do so until Kazakhstan and Iraq meet their pledges to pay back overproduction.

I think there is an element of short-covering at the moment but yesterday’s report from shale driller Diamondback Energy highlights the likelihood of US output falling this year (and continuing to fall sub-$60).

The company cut its capex budget for the year by 10% and CEO Travis Stice penned a letter:

“We are taking our foot off the accelerator as we approach a red light.
If the light turns green before we get to the stoplight, we will hit the
gas again, but we are also prepared to brake if needed,” Stice wrote, highlighting that it needs to see $65 oil, particularly with steel tariffs spiking the price of casing.

He estimates the US frac crew count is down 15% this year and expected to decline further.

“It is likely that US onshore production has peaked,” he said in a sharp rebuke to ‘drill, baby, drill’ talk of the White House.

The big kicker is that US Tier 1 inventory is drying up.

“Today, geologic headwinds outweigh the tailwinds provided by improvements in technology and operational efficiency,” Stice wrote.

At oil below $70, those headwinds won’t go away.

This article was written by Adam Button at www.forexlive.com.

When Trump was elected, one of the most-predictable outcomes was a resumption of steel and aluminum tariffs. This chart shows imports of ‘finished metal shapes’, which is the official way of saying ‘things made out of metal’.

That points to a $78 billion excess build-up in US metals imports that will slowly be exhausted. How slowly? At the pre-2025 pace of imports of pre-tariffs of $3.48 billion, it will take 22 months to exhaust.

This article was written by Adam Button at www.forexlive.com.

The US continues to tease a big trade deal and it’s likely with India, but after saying on Thursday that it was coming later that day, the deal still hasn’t been struck.

Meanwhile, the UK just appears to have concluded negotiations with India at the same time. India Prime Minister Modi said they have successfully concluded a mutually beneficial trade agreement.

This article was written by Adam Button at www.forexlive.com.

• Prior -$1.52B
• Trade Balance for March C$-0.51B vs C$-1.56B est.
• Exports C$69.90 billion versus C$70.04B last month
• Imports C$70.40 billion versus C$71.44B last month

The modest decline is still a drag on the Canadian growth, but it was still better than expectations and something closer to 0 is better for US/Canada relations.

PM Carney will be meeting with Pres. Trump today. I wonder what his mood will be on the first visit since it being elected?

This article was written by Greg Michalowski at www.forexlive.com.

• Prior was -122.7B
• Goods trade balance -163.17B vs -161.9B prior
• Prior goods trade balance was -147.85B

This is the largest US trade deficit on record but it should improve in April/May once the front-run of tariffs is done.

This article was written by Adam Button at www.forexlive.com.

Where are the US red lines on trade?

This is the big question that needs an answer for me to have any kind of conviction in the macro outlook. Yesterday Kyodo reported this:

U.S. officials including Treasury Secretary Scott Bessent told Japan’s
top negotiator Ryosei Akazawa in their meeting in Washington last week
that the administration of President Donald Trump intends to put only a
cut in the 14 percent country-specific tariff, suspended through early
July, on the negotiating table, the sources said

That’s a big problem for Japan and the rest of the world. If the US is putting a floor on 10% tariffs then we’re in for a bruising trade war. I just can’t see many countries conceding anything if the US isn’t aiming for free trade.

Moreover, I fear that Trump wants these negotiations to fail so he can put on tariffs. Maybe that sets up a showdown with Congress that restores order but that’s a hard bet to make at this point.

In the meantime, we get US and Canadian trade balance numbers today for March. At 11:30 pm ET, Carney will arrive to meet Trump and the pair will have a meeting 15 minutes later and then lunch at 12:15 pm ET. It’s not clear when they will address the media.

As for the trade data, I wouldn’t expect it to be a market mover.

This article was written by Adam Button at www.forexlive.com.

Chris Lunday, a reporter for Politico, is saying that the Bundestag will hold a second Merz vote today at 15:15 Berlin time. He adds “all factions have been summoned and full attendence is expected. This is the make or break moment for Merz.”

Link to his post on X here

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• China will hold press conference on Wednesday on financial policy package
• EU’s Sefcovic: EU doesn’t feel weak or under pressure to accept unfair deal with the US
• Taiwan central bank says will visit FX custodian banks to carry out inspections
• Germany’s AfD backs new vote for chancellor on Wednesday
• Eurozone March PPI -1.6% vs -1.6% m/m expected
• German parliament reportedly won’t be going ahead with another chancellor vote today
• UK April final services PMI 49.0 vs 48.9 prelim
• China’s Xi: China and EU should oppose unilateral bullying
• Merz falls short of majority needed to become German chancellor in first voting round
• Eurozone April final services PMI 50.1 vs 49.7 prelim
• SNB’s Schlegel: We haven’t ruled out negative interest rates
• Germany April final services PMI 49.0 vs 48.8 prelim
• France April final services PMI 47.3 vs 46.8 prelim
• Italy April services PMI 52.9 vs 51.5 expected
• EU Trade Commissioner Sefcovic: Proposed 0 for 0 tariffs on industrial goods
• SNB’s Schlegel: We remain committed to our mandate of price stability
• Spain April services PMI 53.4 vs 54.0 expected
• China says would welcome EU leaders to visit in a timely manner to hold new round of talks
• What are the main events for today?
• Switzerland April seasonally adjusted unemployment rate 2.8% vs 2.8% expected
• Gold keeps the push higher after another round of bids in Asia
• FX option expiries for 6 May 10am New York cut
• Goldman Sachs expects USD/CNY to decline further

It would have been a pretty boring session in terms of data and news releases if it wasn’t for German politics. Merz fell short of majority needed to become German chancellor in the first voting round.

He needed 316 votes to win a majority but didn’t manage to reach that
(only got 310 votes) even though the CDU/CSU/SPD coalition has 328 MPs.

The DAX reacted by selling off but eventually bottomed and started to recover the losses as AfD backed a new vote as early as Wednesday.

Another notable news was the Chinese State Council Information Office reporting that Chinese officials
including the PBoC would hold a press conference tomorrow on financial
policy package to stabilise market and expectations. Chinese stocks rallied on the news as expectations for a proper stimulus started to build.

The focus now switches to Trump-Carney meeting due at 11:45 ET/15:45 GMT and potential trade related headlines. There’s no data release in the American session other than the 10y auction for those following them.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

I don’t know what is the source of the news but many newswires are reporting it. This is likely an algo driven reaction to the headline but it’s not something new. I wouldn’t be surprised if the moves get faded shortly.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

It’s been a nice day for DAX traders as political volatility provided some nice opportunities. Below you can see the 5 minute chart of the DAX where I marked the two main headlines that triggered the biggest moves.

I thought this was a great example for new traders on being open minded and nimble when conditions change. The fear of political instability triggered by the failure of the first voting round sent the DAX lower.

But when we started to get more and more news of support for a second round as soon as tomorrow, the fears started to ease and the dip-buyers started to pile in.

It’s critical for a trader to be open minded and not get attached to his/her own bias when conditions change. If you took a trade because of X and something invalidates the original reason, just get out. This will not save you money in the long term, but might also improve your performance if you can also take the other side.

This article was written by Giuseppe Dellamotta at www.forexlive.com.