The President of the United States expressed his frustration after the European Union retaliated by increasing import tariffs on American whiskey products. This was announced by U.S. Commerce Secretary Howard Lutnick, who mentioned that Trump is contemplating raising tariffs on alcoholic beverages from Europe by as much as 200%.
This policy has raised concerns about an escalating trade war, impacting the financial markets on Thursday and likely continuing to influence trading on Friday (March 14, 2025).
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GOLD
Gold prices (XAUUSD) soared by $55 or 550 pips during Thursday’s trading, reaching $2,988.49 per troy ounce. Today, Gold has climbed again to $2,993.94 per troy ounce, putting it just shy of crossing the $3,000 per troy ounce threshold.
Trump’s plan to impose a 200% import tariff is part of a reciprocal policy that might take effect in April. Under this policy, if another country raises its tariffs on U.S. goods, Trump will respond by similarly increasing tariffs on imports from that country. Such moves could instigate a larger trade war and increase Gold’s demand as a safe haven, thus driving prices higher.
This sentiment is expected to continue influencing Gold trading during the European session today.
OIL
Oil prices (CLS10) fell by $0.93 to $66.75 per barrel in Thursday’s trading, approaching the lowest point observed since April 2023.
Concerns over a growing trade war could potentially pressure the global economy, possibly leading to a decrease in Oil demand. This sentiment will also likely impact Oil trading during the European session.
EURUSD
The EURUSD pair dropped 357 points (35.7 pips) to 1.08514 during Thursday’s trading. This marks a two-day decline following a peak that the pair reached in the last four months.
The EURUSD experienced pressure after Trump’s announcement regarding the proposed 200% increase in import tariffs on alcoholic beverages from Europe. Trump’s annoyance stemmed from the European Union’s decision to raise tariffs on U.S. whiskey in response to the 25% tariffs on steel and aluminum imposed by the U.S.
This situation has triggered a profit-taking trend on EURUSD, which may continue into the European trading session.
GBPUSD
GBPUSD exhibited volatility during Thursday’s trading, concluding at 1.29503. Compared to Wednesday’s close, the pair fell by 121 points (12.1 pips).
GBPUSD has remained fairly strong, sustaining its position near a four-month high, as the UK is unlikely to engage in a broader trade war with the United States.
In the European trading session, the release of economic growth data (Gross Domestic Product/GDP) and industrial production figures for the UK at 14:00 WIB could significantly influence market movements.
Forecasts from Trading Central suggest that GDP for January will grow by 0.1% month-on-month (MoM), a decrease from the previous month’s growth of 0.4% MoM. Meanwhile, industrial production is expected to drop by -0.3% MoM compared to December 2024, which showed a growth of 0.5% MoM.
If the actual data falls short of forecasts, it could place downward pressure on GBPUSD and trigger profit-taking actions.
USDJPY
The USDJPY pair declined by 449 points (44.9 pips) to 147.803 during Thursday’s trading, while today, it rebounded by 76 pips to 148.569. The high volatility of USDJPY indicates that market participants are weighing the ongoing global dynamics, particularly regarding the trade conflict.
Such conditions may suppress global economic growth and increase the demand for safe havens. Both the US dollar and yen hold safe haven statuses, leading to their volatile movements.
This sentiment is likely to continue influencing the USDJPY movements during the European trading session. Additionally, recent U.S. economic data opens up more room for the Fed to consider rate cuts, potentially casting a negative sentiment over USDJPY.
Nasdaq
The Nasdaq index fell by 278 points to 19,292, nearing its lowest level in the past six months. Concerns about a wider trade war are exerting pressure on the Nasdaq, and this trend is expected to carry over into the European trading session.
