Global Markets Slide as Tariff Fears Return

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Forex Market

USD: Tariff Concerns Drive Dollar Gains


The USD strengthened broadly overnight after confirmation of President Trump’s tariff announcements, elevating risk-off sentiment.

  • AUD/USD fell to lows of 0.6485 overnight, pressured by rising trade tensions and broad USD strength.

  • EUR/USD declined steadily, touching lows at 1.1687 amid stronger USD demand.

  • GBP/USD weakened to 1.3579 lows, remaining subdued through the session.

  • USD/JPY surged to highs at 146.24 on rising yields and safe-haven flows.

  • USD/CAD firmed, driven by improved USD sentiment and higher crude oil prices, reaching highs near 1.3800.

  • NZD/USD dipped to lows at 0.5990, mirroring AUD weakness in risk-averse conditions.

 

AUD: Heavy into RBA Decision

The Australian dollar remained heavy through yesterday’s trading amid deteriorating risk sentiment and positioning ahead of the RBA’s rate decision. AUD/USD settled near its daily low of 0.6485 after trading a 0.6485–0.6556 range. Markets are awaiting clearer guidance from today’s RBA announcement to determine AUD’s next direction.

 

Key Economic Data Ahead (Sydney Time)

General Market

Wall Street

A heavy session on Wall St. saw broad-based losses as trade concerns re-emerged:

  • Nasdaq -1.0%

  • S&P 500 -0.9%

  • Dow Jones -1.2%

U.S. 10-year yields rose to 4.38% (+4bps), while brent crude gained 2% to $69.65/bbl.

Asia-Pacific

Asian equities ended lower:

  • Nikkei -0.6%

  • Shenzhen -0.4%

  • Hang Seng -0.1%

  • ASX -0.2% (Materials -0.9%, Consumer Discretionary -0.7%)

AUD/USD fell throughout the day, driven by weaker sentiment and USD strength.

Europe

European equities started mixed but found late-session support:

  • DAX +1.2%

  • CAC +0.4%

  • FTSE -0.2%

EUR/USD and GBP/USD drifted lower as USD strength dominated quiet London trade.

 

 

Headlines to Watch

  • Trump Confirms New Tariffs Starting August 1
    President Trump announces 25% tariffs on goods from Japan and South Korea, with more countries potentially affected, raising global trade tensions.

  • RBA Likely to Cut Rates Today
    Markets expect the Reserve Bank of Australia to reduce the cash rate by 25bps to 3.60%, highlighting concerns over slowing domestic growth.

  • US Consumer Confidence & Richmond Fed Index in Focus
    Upcoming U.S. data releases will shed light on consumer sentiment and regional economic activity amid rising economic uncertainty.

 

Mid-market rates.

Currency PairMid-market Rate
AUD/USD0.6510
AUD/NZD1.0837
AUD/JPY95.28
AUD/CNY4.6707
AUD/EUR0.5548
AUD/GBP0.4779
AUD/HKD5.1097

 

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