Euro rises amid thin trading due to the Good Friday holiday
Euro inched higher on Friday against a basket of major rivals, moving in a tight range against the US dollar as most markets close for the Good Friday holiday.
The European Central Bank cut interest rates by 25 basis points this week as expected to October 2022 lows, with President Christine Lagarde describing tariffs as “a shock to demand”.
The Price
The EUR/USD rose 0.2% today to $1.1385, with a session-low at $1.1359.
The pair closed down over 0.3% on Thursday, the second loss in three days on profit taking away from a three-year peak at $1.1474.
The ECB
The European Central Bank cut interest rates by 25 basis points to 2.25% as expected by most analysts today.
It’s the seventh consecutive rate cut as the ECB attempts to boost the struggling eurozone economy amid a trade war with the US.
ECB President Christine Lagarde said that tariffs represent a shock, but their impact on inflation remains unclear.
She said the picture might not become clear by the next policy meeting in June, as the 90-day pause on tariffs would still be in place by then.
European Rates
Reports showed that some ECB officials see a high probability of a rate cut in June.
Markets are pricing in a 60% chance of an ECB rate cut in June.
Yen climbs after BOJ Governor Ueda's remarks
The Japanese yen rose in Asian trade on Friday against a basket of major rivals, resuming gains after a short hiatus against the greenback, and moving towards seven-month highs on track for the third weekly profit in a row.
The gains come after bullish remarks by Bank of Japan Governor Kazuo Ueda, in addition to data that showed Japanese inflation accelerated in March, boosting the odds of a rate hike in May.
The Price
The USD/JPY fell 0.2% today to 142.19 yen per dollar, with a session-high at 142.44.
The yen lost 0.4% on Thursday against the dollar on profit-taking away from a seven-month high at 141.61.
Weekly Trades
The yen is up 0.9% so far this week on the dollar, on track for the third weekly profit in a row.
Ueda
Bank of Japan Governor Kazuo Ueda said the central bank will continue to hike interest rates if inflation moves towards the 2% target.
He says the BOJ will monitor economic developments without prejudice due to uncertainty because of US tariffs.
Main Inflation
Earlier Tokyo data showed main consumer prices rose 3.2% in March as expected, up from 3% in February.
Higher inflation raises pressures on BOJ policymakers to move quickly with its policy tightening plans.
Japanese Rates
Following the remarks and data, the odds of a 0.25% BOJ rate hike in May rallied from 10% to 35%.
Ripple declines but still registers over 5% weekly profit
Ripple tumbled today on profit-taking amid a weak risk appetite and mixed performance in the crypto market overall.
US President Donald Trump ordered a full tariff review of US critical minerals imports in another escalation in his trade war with global trade partners.
Otherwise, Fed Chair Jerome Powell said that tariffs and the ongoing trade war between the US and the world, especially China, could weaken the Fed’s ability to contain inflation and boost US growth.
Powel expects inflation to rise and growth to slow down, but it’s still not clear which one of them needs more focus amid trade uncertainty.
Powell said the Fed is assuming a wait and see stance until the dust clears before taking a monetary policy decision.
He also expects the economy to move away from full employment and contained inflation targets due to the impact of tariffs.
In response, Trump criticized Powell and said his “termination couldn’t come soon enough”.
Separately, the European Central Bank cut interest rates by 25 basis points to 2.25% as expected by most analysts today.
It’s the seventh consecutive rate cut as the ECB attempts to boost the struggling eurozone economy amid a trade war with the US.
ECB President Christine Lagarde said that tariffs represent a shock, but their impact on inflation remains unclear.
Ripple
On trading, ripple slid 1.6% on Coinmarketcap as of 20:39 GMT to $2.07, with a weekly profit of 5.1%.
Gold dips but still marks weekly profits
Gold prices fell on Thursday as the dollar stabilized against most major rivals, with the precious metal still marking weekly gains.
US President Donald Trump ordered a full tariff review of US critical minerals imports in another escalation in his trade war with global trade partners.
Otherwise, Fed Chair Jerome Powell said that tariffs and the ongoing trade war between the US and the world, especially China, could weaken the Fed’s ability to contain inflation and boost US growth.
Powel expects inflation to rise and growth to slow down, but it’s still not clear which one of them needs more focus amid trade uncertainty.
Powell said the Fed is assuming a wait and see stance until the dust clears before taking a monetary policy decision.
He also expects the economy to move away from full employment and contained inflation targets due to the impact of tariffs.
In response, Trump criticized Powell and said his “termination couldn’t come soon enough”.
Separately, the European Central Bank cut interest rates by 25 basis points to 2.25% as expected by most analysts today.
It’s the seventh consecutive rate cut as the ECB attempts to boost the struggling eurozone economy amid a trade war with the US.
ECB President Christine Lagarde said that tariffs represent a shock, but their impact on inflation remains unclear.
Otherwise, the dollar index rose 0.1% as of 18:32 GMT to 99.4, with a session-high at 99.7, and a low at 99.2.
On trading, gold spot prices fell 0.4% as of 19:54 GMT to $3334.7 an ounce, while marking a weekly profit of 2.6%.