Tariff Pause for Automakers Soothes Markets, Euro Stands Tall Ahead of ECB Cut
| Action Insight Daily Report 3-6-25 |
Tariff Pause for Automakers Soothes Markets, Euro Stands Tall Ahead of ECB Cut |
Risk sentiment is mildly positive in Asian session today, as investors digest the latest developments in US trade policy and Chinese economic measures. Markets welcomed the news that the US has granted a one-month exemption for imports from Mexico and Canada for auto makers. The decision came after US President Donald Trump met with executives from Ford, General Motors, and Stellantis, who urged him to delay the levies to avoid disruptions in the industry. Meanwhile, Hong Kong stocks surged to a three-month high, with optimism fueled by hints from China's National People’s Congress about looser monetary policies, along with expectations for further stimulus. Adding to the bullish momentum, tech giant Alibaba saw its stock soar after unveiling a new AI model, which it claims is competitive with DeepSeek, a major player in the artificial intelligence race. The rally in Chinese markets is adding to overall risk appetite in Asia, though uncertainties remain around US-China trade tensions. In the currency markets, Euro continues to lead gains for the week as investors anticipate today’s ECB policy decision. The central bank is widely expected to deliver a 25-basis-point rate cut, but the outlook for further easing is more uncertain than ever. A trade war with the US is adding downside risks to growth, while Europe's major economies are making historic shifts in fiscal policy, particularly in Germany, where new spending initiatives could support economic expansion. These conflicting factors make it challenging to predict ECB’s path beyond today’s meeting.... |
EUR/USD Daily Outlook Daily Pivots: (S1) 1.0662; (P) 1.0729; (R1) 1.0857; More... Intraday bias in EUR/USD remains on the upside as current rally from 1.0176 is still in progress. Next target is 161.8% projection of 1.0176 to 1.0531 from 1.0358 at 1.0932 On the downside, below 1.0721 minor support will turn intraday bias neutral and bring consolidations first, before staging another rise. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 00:30 | AUD | Building Permits M/M Jan | 6.30% | -0.10% | 0.70% | 1.70% | | 00:30 | AUD | Trade Balance (AUD) Jan | 5.62B | 5.68B | 5.09B | 4.92B | | 06:45 | CHF | Unemployment Rate Feb | 2.70% | 2.70% | | 09:30 | GBP | Construction PMI Feb | 49.8 | 48.1 | | 10:00 | EUR | Eurozone Retail Sales M/M Jan | 0.10% | -0.20% | | 12:30 | USD | Challenger Job Cuts Y/Y Feb | -39.50% | | 13:15 | EUR | ECB Deposit Rate | 2.50% | 2.75% | | 13:15 | EUR | ECB Main Refinancing Rate | 2.65% | 2.90% | | 13:30 | CAD | Trade Balance (CAD) Jan | 1.4B | 0.7B | | 13:30 | USD | Initial Jobless Claims (Feb 28) | 236K | 242K | | 13:30 | USD | Trade Balance (USD) Jan | -93.1B | -98.4B | | 13:30 | USD | Nonfarm Productivity Q4 | 1.20% | 1.20% | | 13:30 | USD | Unit Labor Costs Q4 | 3% | 3% | | 13:45 | EUR | ECB Press Conference | | 15:00 | USD | Wholesale Inventories Jan F | 0.70% | 0.70% | | 15:00 | CAD | Ivey PMI Feb | 50.6 | 47.1 | | 15:30 | USD | Natural Gas Storage | -96B | -261B |
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