March 31, 2025
- Trump’s latest tariff comments roil global markets.
- Canada hoping for easier treatment from Trump
- US dollar sinks on risk aversion.
FX at a Glance
USDCAD: open 1.4353, overnight range 1.4276-1.4362, close 1.4320
USDCAD is at the top of its overnight range with the gains fueled by wide-spread “risk-off” sentiment following a weekend of Trump comments and musings.
New Brunswick Premier Susan Holt said she was told by Ottawa officials that Canada will be treated easier than other nations when Trump imposes tariffs. It that the same as winning Bronze at the Olympics?
America prides itself in its Democracy, but one man with a desk drawer full of Executive Orders is crushing US and global equity markets while upsetting the world order, all without a debate or a vote in Congress. It is now the United States Soviet Republic as it mirrors the heady days of the USSR.
It is also month and quarter end and the S&P 500 losses in March and year today date suggest USDCAD buying as managers rebalance portfolios.
There are no US or Canadian economic reports of note released today.
USDCAD Technicals
The intraday USDCAD technicals are bullish above 1.4300 and supported by the break above 1.4330, setting the stage for a break above 1.4380 to target 1.4440.
The medium-term outlook is bullish with the move above 1.4300 snapping the March downtrend and shifting the focus to a retest of the 1.4550 area. The momentum indicators are starting to turn higher and USDCAD is targeting 1.4490.
For today, USDCAD support is 1.4330 and 1.4300. Resistance is at 1.4370 and 1.4420.
Today’s Range: 1.4330-1.4430
Chart: USDCAD 1 day
The Mouth that Roared
Donald Trump was in top form on the weekend. In no particular order: 1) he retweeted a post from a guy calling for the resignation of Judge Boasberg for not being able to keep signals while denigrating Meet the Press for spending a half hour discussing “the boring Signal Witch Hunt.” 2) He portrayed himself as a nice guy for agreeing to Kid Rock’s request and meeting with Bill Maher but said, “problem is, no matter how much he likes your Favorite President, ME, he will publicly proclaim what a terrible guy I am.” 3) Numerous media reports say that Trump is pushing for his team to go for higher tariffs despite his words to the contrary last week. 4) He threatened to impose tariffs on any nation that buys Russian crude if Russia continues to hamper cease-fire negotiations. 5) Trump said he is considering running for a third term.
Tariff Day Terror Trashes Markets.
Wall Street had a bad day on Friday, and it was worse for Asian equity markets overnight. Trump’s comments and threat of escalating tariffs drove Australia’s ASX 200 down 1.74%, and Japan’s Topix fell 3.57%. European bourses are drowning in a sea of red ink, led by a 1.82% drop in the German Dax and a 1.17% plunge in the FTSE 100. S&P 500 futures are down 0.88% and safe-haven gold (XAUUSD) rose to 3127.88 from 3054.75 at Friday’s low. The 10-year Treasury yield dropped to 4.178% from 4.36% on Friday. The US dollar index is above the middle of its 103.42–103.83 range as risk aversion sinks the greenback against the yen, Swiss franc, and euro.
EURUSD
NY Open: 1.0816, Overnight Range: 1.0764–1.0850
EURUSD is resilient in the face of plunging Eurozone stock markets and Trump’s threat of even higher tariffs than he previously said. Eurozone data was ignored, but news that a French court found Marine Le Pen, leader of the far National Party, guilty of embezzlement and banned her from running for public office. Meanwhile, US recession risks fueled demand for EURUSD.
GBPUSD
NY Open: 1.2927, Overnight Range: 1.2921–1.2973
GBPUSD gave up earlier gains and dropped to its session low in NY despite UK PM Starmer and Trump having “productive discussions” on the weekend. Nevertheless, it’s tariffs talk, not economic data, that is moving markets.
USDJPY
NY Open: 149.24, Overnight Range: 148.71–151.22
USDJPY dropped on the back of broad-based safe-haven demand and because of plunging US 10-year yields. The pressure was also due to expectations for the BoJ to raise rates. However, Trump’s auto tariffs will hit Japan’s economy right between the eyes.
AUDUSD
NY Open: 0.6250, Overnight Range: 0.6249–0.6314
AUDUSD traded negatively due to AUDJPY selling pressure and fears that Trump’s tariffs will derail China’s nascent economic rebound.
NZDUSD
NY Open: 0.5685, Overnight Range: 0.5684–0.5746
NZDUSD is in the same boat as AUDUSD—risk-off sentiment driven by tariffs drove prices down.
USDMXN
NY Open: 20.4018, Overnight Range: 20.2668–20.4688
USDMXN soared on the mix of Trump tariffs and Banxico hinting at further interest rate cuts, although the tariffs were the main driver.
FX high, low, open (as of 6:00 am ET)
China Snapshot`
PBoC fix: 7.1782 vs exp. 7.2593 (Prev. 7.1752
Shanghai Shenzhen 300 fell 0.71% to 3887.32
NBS Manufacturing PMI (Mar) 50.5 vs. Exp. 50.5 (Prev. 50.2)
NBS Non-Manufacturing PMI (Mar) 50.8 vs. Exp. 50.5 (Prev. 50.4)
Composite PMI (Mar) 51.4 (Prev. 51.1)
Sources: Yahoo Finance, Oanda, Investing.com, Bloomberg.
