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The U.S. dollar edged up slightly on Wednesday, while other major currencies remained within tight ranges, as traders awaited details of President Donald Trump’s tariff plans. These measures, set to be unveiled in a White House Rose Garden announcement at 20:00 GMT, could disrupt global trade flows and heighten financial market volatility.
Currency Market Movements
- Euro: $1.0784, slightly weaker.
- British Pound (Sterling): $1.2907, easing ahead of tariff details.
- Japanese Yen: 149.70 per dollar, with the dollar inching up against the yen.
- Australian Dollar: $0.62301, up 0.36%, rebounding from earlier losses.
- Canadian Dollar: C$1.4304 per dollar, slightly weaker.
- Mexican Peso: 20.389 per dollar, also weakening.
The U.S. Dollar Index (DXY) rose marginally to 104.28, though the greenback remains under pressure, having recorded a 3.1% decline in March, its worst monthly performance since November 2022.
Trump’s “Liberation Day” Tariff Plan
- Trump has labeled April 2 as “Liberation Day”, emphasizing reciprocal tariffs on countries imposing duties on U.S. goods.
- The Washington Post reports that Trump’s aides are considering raising duties by 20% on nearly all imported products, rather than targeting specific countries or industries.
- White House spokeswoman Karoline Leavitt confirmed that tariffs would take effect immediately following Trump’s announcement.
These policies could upend global trade, leading to higher import costs, inflationary pressures, and potential economic slowdowns worldwide.
Weaker U.S. Data & Economic Outlook
- U.S. manufacturing contracted in March, as revealed by data on Tuesday.
- Factory-gate inflation surged to its highest level in nearly three years, adding inflationary concerns amid import tariffs.
- Recession fears have undermined the dollar this year, as concerns over a global trade war intensify.
Global Reactions & Economic Risks
- Canadian PM Mark Carney and Mexican President Claudia Sheinbaum discussed Canada’s plan to counter “unjustified” U.S. trade actions.
- Bank of Japan Governor Kazuo Ueda warned that U.S. tariffs could have a massive impact on global trade, potentially slowing world economic growth.
With markets on edge, traders are closely monitoring Trump’s tariff announcement later today, as well as its potential repercussions for the global economy and financial markets.
