March 25, 2025
- US consumer confidence expected to have fallen in March.
- Carney won’t debate in French
- USD is directionless in uneventful overnight session.
FX at a Glance
USDCAD: open 1.4319, overnight range 1.4285-1.4333 close 1.4319
USDCAD is inching lower and nearing major support after another Trump flip-flop on tariffs improves sentiment. Trump hinted that he may delay auto tariffs while simultaneously warning that they are coming. That was enough to attract USDCAD selling. However, the price action looks to be just noise as traders await top-tier US GDP data on Thursday, followed by the CORE-PCE price index on Friday.
The CAD/US 10-year interest rate spread has widened to -129.9 from -119.3 last Thursday. If it widens further, it suggests limited USDCAD downside.
WTI oil prices are near the top of its 68.89-69.63 range due to Trump’s latest tariff. He said that any country buying crude from Venezuela will be hit with a 25% tariff on all trade with the US.
There are no Canadian economic reports of note today.
USDCAD Technicals
The intraday USDCAD technicals are bearish below 1.4350 and looking for a break below 1.4270, to test support at 1.424. A move above 1.4350 argues for continued 1.4270-1.4370 consolidation.
The medium-term outlook remains unchanged—bullish while prices are above 1.4270 which is the 38.2% Fibonacci retracement of the September-February, 1.34201.4785 range. A decisive move below 1.4270 suggests further losses to the 50% Fibonacci level of 1.4212.
For today, USDCAD support is 1.4270 and 1.4240. Resistance is at 1.4340 and 1.4370.
Today’s Range: 1.4270-1.4350
Chart: USDCAD 1 day
“Please Disregard the Secret War Plans Conversation”
National security advisor Mike Waltz accidently invited a journalist from the Atlantic to a group chat with VP Vance, US Secretary of Defense Pete Hegseth, deputy chief of staff Stephen Miller, Secretary of State Marco Rubio, and CIA boss John Ratcliff to discuss bombing Yemen. Trump wasn’t phased—he said, “I’m not a big fan of the Atlantic.” And that in a nutshell (pun intended) demonstrates that the nutbars are really in charge of the Snickers factory.
Are US Consumers Confident?
The Conference Board consumer confidence index is released at 10:00 am. Analysts expect it to drop to 94.0 from 98.3 due to mass government lay-offs and the risk of higher inflation from Trump’s tariff agenda. The rest of today’s data dump includes January housing price index, new home sales, and the Richmond Fed manufacturing index.
EURUSD
NY Open: 1.0803, Overnight Range: 1.0777-1.0820
EURUSD climbed above the top of its overnight peak in early NY following a positive surprise from today’s German IFO data. The trio of indexes, Business Climate, Current Assessment, and Expectations were better than in February and, when combined with the recent €500 billion stimulus package, raised hopes for an economic rebound. Those hopes are reinforced with the US getting Russia/Ukraine ceasefire talks moving.
GBPUSD
NY Open: 1.2962, Overnight Range: 1.2902-1.2944
GBPUSD drifted aimlessly, then popped through the top of the overnight range in NY trading. GBPUSD traders are sidelined ahead of Wednesday’s Spring Update or mini budget. At issue is how the chancellor will navigate the UK’s surging debt burden and falling growth. Tomorrow, the Office for Budget Responsibility (OBR) is expected to announce a downgrade to the 2025 UK growth forecast from 2.0% to 1.0%.
USDJPY
NY Open: 150.44, Overnight Range: 150.41-150.94
USDJPY is consolidating yesterday’s gains at the bottom of its overnight range. Prices are underpinned by yesterday’s rise in the US 10-year Treasury yield from 4.28% to 4.36% today and the hawkish tone to the BoJ minutes. The minutes show that policymakers discussed the pace of raising rates but remained concerned about rising food inflation. The BoJ also noted that real interest rates would remain significantly negative even after a rate hike. The news was not much of a surprise.
AUDUSD
NY Open: 0.6299, Overnight Range: 0.6279-0.6300
AUDUSD started the NY session at the top of its overnight band and then inched higher to 0.6305. Prices are getting lingering support from yesterday’s stronger-than-expected PMI data and Trump’s flip-flop from imposing blanket tariffs to a more targeted approach on April 2. Traders are awaiting Australian February inflation data tomorrow, which is expected to be unchanged at 2.5% y/y.
NZDUSD
NY Open: 0.5726, Overnight Range: 0.5711-0.5736
NZDUSD drifted sideways but with a negative bias due to the expectations that the RBNZ will cut rates by 25 bp to 3.5% on April 9. However, that move is largely priced in, and traders are hoping that China’s stimulus plans will offset the impact of US tariffs, which is providing some currency support.
USDMXN
NY Open: 20.1823, Overnight Range: 19.1999-20.0550
USDMXN is licking its wounds after dropping from 20.2390 yesterday after Trump appeared to water-down his tariff plans. Yesterday’s dip in Mexican inflation ensures that Banxico will cut rates by 50 bps to 9.0% on Thursday. January retail sales are on tap.
FX high, low, open (as of 6:00 am ET)
China Snapshot`
PBoC fix: 7.1788 vs exp. 7.2630 (Prev. 7.1780)
Shanghai Shenzhen CSI 300 rose 0.51% to 3934.85
Sources: Yahoo Finance, Oanda, Investing.com,
