Financial markets exhibit a steady performance at the start of the European trading session on Tuesday (April 8, 2025). With no significant economic data being released, the focus shifts to the ongoing trade tensions sparked by US President Donald Trump.
Trump has previously threatened to increase tariffs on imports from China by an additional 50%. Meanwhile, the European Union plans to negotiate with the United States and put forward a ‘zero for zero’ tariff proposal.
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These developments regarding both the threats and negotiations could significantly influence market movements in tonight’s trading.
GOLD
Gold prices (XAUUSD) have managed to hold onto gains, hovering around the daily high of $3,015.87 per troy ounce. Gold recently rebounded after experiencing a three-day decline, which was influenced by falling assets in other markets. This decline prompted many traders to liquidate their Gold positions to realize profits and offset losses in other investment areas.
As noted in the previous Macro Overview, with other assets, particularly stock indices showing more stability, and the potential for heightened trade tensions, Gold is likely to receive positive sentiment again. Additionally, the People’s Bank of China has reported that it increased its Gold reserves in March, indicating that central banks around the world continue to purchase Gold despite its high price, which could contribute to a positive sentiment in the market.
OIL
Oil prices (CLS10) have shown volatility, ranging between $60.15 and $61.72 per barrel during the early European trading hours. Oil prices remain near their lowest level in over a year.
The market sentiment surrounding Oil is weighed down by concerns of declining demand due to the potential slowdown in the global economy. Additionally, there are pressures from OPEC+, which plans to increase production by 400,000 barrels per day.
EURUSD
EURUSD has retraced some of its gains after previously reaching a level of 1.09920. Compared to the closing price on Monday, EURUSD increased by 891 points (or 89.1 pips) before the pullback.
Market participants are awaiting news regarding the European Union’s negotiation plans with the United States. If the EU’s ‘zero for zero’ proposal receives a positive response from Trump, it could provide additional positive sentiment for EURUSD.
GBPUSD
GBPUSD has also retraced its earlier gains after hitting a daily high of 1.27961. This currency pair previously declined for two consecutive days, reaching a one-month low.
The market perceives that the risk of a global economic slowdown may lead the Bank of England (BoE) to cut interest rates more aggressively this year.
Nevertheless, hopes for a trade agreement between the European Union and the United States have added some positive sentiment for GBPUSD.
USDJPY
USDJPY dropped to 146.858 in the early European trading session. This represents a decrease of 984 points (or 98.4 pips) compared to the previous close. Just yesterday, this currency pair saw a rise of 118 pips, indicating a volatility caused by trade tensions, as both the US dollar and yen are considered safe-haven assets.
As mentioned in the previous Macro Overview, the volatility in USDJPY is observable, while EURUSD is likely to remain under pressure following yesterday’s sharp increases.
Nasdaq
The Nasdaq index has managed to sustain its gains after peaking at 17,889. The rise in technology giants has propelled the Nasdaq’s performance. Furthermore, the EU’s plan to propose the ‘zero for zero’ tariff structure to the United States has contributed to positive market sentiment.
If Trump responds favorably to the EU’s proposal, the sentiment surrounding the Nasdaq could improve even further.
