04/04/2025 - 07:56 UTCThe US Dollar Index (USDX) remained in negative territory for a second consecutive day, experiencing a significant decline on Thursday. It ended the session 1.61% lower at 101.684, as observed on the iForex platform. This decline followed President Trump’s “Liberation Day” tariff announcement, which triggered investor concerns about a potential slowdown in economic activity. The dollar’s downward movement was further exacerbated by weaker-than-expected economic data and growing speculation about a shift in Federal Reserve policy.
President Trump’s tariff package, which includes a 10% baseline import duty and additional levies, has raised concerns that these measures could lead to stagflation, as higher import costs could weigh on consumer prices while economic growth slows.
Thursday’s economic data further fuelled market anxieties, with the US ISM Services PMI dropping sharply in March to 50.8, falling short of the expected 53.0, signalling a slowdown in the services sector. Unemployment claims also disappointed, with initial claims falling to 219K, missing forecasts, while continuing claims climbed to nearly 1.9 million. The Employment Index within the ISM survey declined to 46.2 from 53.9, raising concerns about labour market conditions. Additionally, price pressures eased slightly, with the ISM’s Prices Paid Index falling to 60.9 from 62.6, suggesting a modest deceleration in inflation.
Asian stocks extended steep losses on Friday as fears of a global recession intensified following U.S. President Donald Trump’s announcement of sweeping trade tariffs. Stock markets in China, Hong Kong, Taiwan, and Indonesia were closed on Friday for respective public holidays, contributing to thin trading volumes in the region. Friday’s sell-off followed a dismal session on Wall Street, where major U.S. indexes plummeted.
Wall Street experienced a dramatic sell-off on Thursday, marking the largest single-day percentage losses in years, as U.S. President Donald Trump’s sweeping tariff measures raised concerns about an escalating trade war and a potential global recession. Investors rushed to sell positions, anticipating retaliatory actions from other countries. China and the European Union pledged retaliation, with the EU facing a 20% duty, while other nations like South Korea, Mexico, and India indicated they would hold off until they can secure concessions ahead of the April 9 tariff deadline.
Today, the focus will be on the release of key U.S. data, including the Non-Farm Payrolls report and the unemployment rate figures, which will provide crucial insights into the health of the labor market. Additionally, Federal Reserve Chairman Jerome Powell is scheduled to deliver a speech which could offer important clues about the Fed's policy stance moving forward.
The EUR/USD currency pair saw a significant rally on Thursday, with the Euro surging as the US Dollar weakened. The Dollar’s slide was triggered by the Trump administration’s announcement of new flat and "reciprocal" tariff packages, which have raised concerns about the economic implications of these measures.
Investor sentiment took a further hit on Thursday, with the US ISM Services Purchasing Managers Index (PMI) for March falling to 50.8, its lowest point in nine months.
Federal Reserve officials have expressed caution regarding interest rate adjustments in light of the tariffs. Fed Governor Jefferson emphasized that the Fed is not in a rush to change rates, while Governor Cook warned that progress on inflation could stall as a result of the tariffs.
Market Participants focus turns to the release of the US Nonfarm Payrolls (NFP) report later today.
Gold prices ended the session lower, losing 1.57% as seen on the iForex platform, but managed to recover some of their recent losses after a brief period of profit-taking the day prior. The yellow metal is finding support as rising fears of a global trade war and persistent geopolitical risks push investors toward gold, a traditional safe-haven asset.
Gold had dropped over 2% from its all-time high, weighed down by a broader market selloff triggered by US President Donald Trump’s reciprocal tariffs policy. Traders attributed the decline to profit-taking, as investors sold some of their bullion holdings to offset losses in other asset classes.
However, the downside for gold could be limited, as concerns over the potential negative impact of Trump’s tariffs on global economic growth could fuel safe-haven demand.
Looking ahead, all eyes will be on Friday’s US employment data, including the Nonfarm Payrolls (NFP) report, the unemployment rate, and average hourly earnings.
Oil prices took a sharp dive on Thursday after OPEC+ announced a surprise increase in oil output, just one day after U.S. President Donald Trump introduced sweeping new import tariffs.
During a ministerial meeting, OPEC+ members decided to accelerate their plan to increase oil output, now aiming to return 411,000 barrels per day (bpd) to the market in May, a significant rise from the 135,000 bpd initially planned.
Before the meeting, oil prices had already fallen, as investors grew concerned that Trump’s tariffs could escalate into a global trade war, dampen economic growth, and reduce fuel demand.
Adding further pressure, the U.S. Energy Information Administration (EIA) reported on Wednesday that U.S. crude inventories had surged by an unexpected 6.2 million barrels last week, contrary to analysts' predictions of a 2.1 million barrel decline.
This combination of factors continues to weigh heavily on oil prices and market sentiment.
The US Tech 100 index experienced a significant decline on Thursday, driven by major selloffs in tech stocks. Apple plummeted 9.43%, hit by a 54% tariff on imports from China, where much of its iPhone production is based. Other tech giants like Amazon, Nvidia, Meta, Google, Microsoft, and Tesla also saw sharp declines.
The tariff-induced turmoil on Wall Street sharply contrasted with the initial optimism following Trump's reelection in November, when expectations of pro-business policies had driven U.S. stocks to all-time highs.
Tech stocks, which had been a key driver of those record highs in recent years, took a significant hit on Thursday.
Wall Street faced its largest one-day percentage losses in years, with the US 500 losing $2.4 trillion in market value. The trigger was President Trump's 10% tariff on most U.S. imports, sparking fears of a trade war and global recession. China and the European Union have vowed retaliation, while other countries like South Korea and Mexico have expressed concerns.
The materials contained on this document should not in any way be construed, either explicitly or implicitly, directly or indirectly, as investment advice, recommendation or suggestion of an investment strategy with respect to a financial instrument, in any manner whatsoever. Any indication of past performance or simulated past performance included in this document is not a reliable indicator of future results. For the full disclaimer click here.
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