The slowing economy of the United States continues to influence market movements as European trading begins on Thursday (February 27, 2025). Furthermore, market participants are closely observing the developments regarding the import tariff plans set forth by President Donald Trump.
This sentiment is expected to impact market dynamics during tonight’s trading, alongside several upcoming US economic data releases. Below is the information from Trading Central:
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- The second estimate of US Gross Domestic Product (quarter-on-quarter/Q4 2024); forecast 2.3% compared to 3.1% previously.
- The US durable goods orders data (month-on-month/January); forecast 2.2% contrasting with the previous -2.2%.
- The number of US unemployment claims (February 22); forecast 225K against the previous 219K.
GOLD
The Gold price (XAUUSD) fell sharply at the start of European trading, reaching a daily low of US$ 2,877.11 per troy ounce. Compared to Wednesday’s close, Gold decreased by US$ 38.81 or 388.1 pips due to profit taking activities.
This profit-taking occurred following President Trump’s announcement early this morning regarding an import tariff hike of 25% on goods from Canada and Mexico, effective April 2. This is a shift from his statement last weekend that indicated the tariffs would take effect on March 4.
Nevertheless, with the uncertain policy landscape, there is potential for Gold to rebound, particularly if tonight’s US economic data is worse than the forecast. Such an outcome would reinforce expectations of a slowing US economy and increase the demand for Gold as a safe haven.
OIL
The price of Oil (CLS10) rose at the beginning of the European session, reaching a daily high of US$ 69.32 per barrel. Oil had previously hit its lowest price in the last ten weeks, leading to some short covering, especially given potential global supply disruptions.
This is due to President Trump revoking Chevron’s oil export permit from Venezuela, amounting to 240,000 barrels per day. Consequently, the supply in the global market is expected to decrease, which brings a positive sentiment for Oil.
EURUSD
EURUSD showed volatility within the range of 1.04590 – 1.04926 by the start of European trading. Data from France indicated that the Producer Price Index (PPI) for January reported a -2.1% year-on-year (YoY), outperforming the forecast from Trading Central of -2.4% YoY, and the previous month’s -3.8% YoY.
In terms of month-on-month growth, PPI increased by 0.7%, exceeding the forecast of 0.4%. This data prompted EURUSD to rebound from its daily lows. This suggests that if US economic data released tonight is worse than the forecast, EURUSD could receive positive momentum.
GBPUSD
GBPUSD traded within a tight range of 1.26499 – 1.26837 at the onset of the European session, hovering near its highest level in two months. A decrease in the likelihood of the Bank of England (BoE) cutting interest rates soon has contributed positively to GBPUSD.
Thus, if US economic data falls short of the forecast, GBPUSD could be supported.
USDJPY
USDJPY moved up at the beginning of the European trading session, hitting a daily peak of 149.970. Compared to Wednesday’s closing, USDJPY increased by 920 points (92 pips) due to short covering after previously reaching its lowest level in four months.
Despite this upswing, if US economic data tonight is disappointing, USDJPY could face downward pressure, as signs of a slowing US economy become more evident.
Nasdaq
Nasdaq saw a turnaround, rising at the start of European trading to a daily high of 21.344 after previously dipping to 21.107. President Trump’s statement regarding the postponement of the import tariff hike on Canada and Mexico to April 2 provided a positive sentiment for Nasdaq.
However, increasing signs of an economic slowdown in the US may still weigh negatively on Nasdaq.
