Trump Tariff Threats Shake FX, RBNZ Holds Rates Steady

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Forex Market

USD: Gains Amid Mixed Sentiment

The USD strengthened amid mixed market sentiment following comments from U.S. President Trump on tariffs. Markets remained cautious with limited directional momentum.

  • AUD/USD traded between 0.64905–0.6559, settling at 0.6530/35.
  • EUR/USD dipped to intra-day lows of 1.16825.
  • GBP/USD fell to new lows at 1.3528.
  • USD/JPY pushed higher to near 147.00.
  • USD/CAD reached highs around 1.3689.
  • NZD/USD dropped to 0.5980 lows.

 

AUD: Brief Spike After Surprise RBA Hold

AUD/USD surged 48 pips to 0.6559 following the RBA’s surprise decision to hold rates at 3.85%, with markets having priced in a 25bps cut. The pair remained elevated near 0.6540/41 in the afternoon but drifted back to 0.6510 overnight. Support is eyed around 0.6400.

 

 

 

Key Economic Data Ahead (Sydney Time)

 

General Market

Wall Street

U.S. equities closed mixed with minimal changes amid continued tariff concerns:

  • Nasdaq unchanged
  • S&P 500 unchanged
  • Dow Jones -0.3%

U.S. 10-year yields rose slightly to 4.40%, and brent crude rose 0.8% to $70.10/bbl.

Asia-Pacific

Asian equities ended higher:

  • Nikkei +0.3%
  • Hang Seng +1.0%
  • Shenzhen +0.9%
  • ASX 200 flat (consumer staples -1.4%)

AUD/USD spiked briefly to 0.6559 following RBA’s surprise decision to hold rates at 3.85%.

Europe

European equities opened mixed and closed modestly positive:

  • DAX +0.1%
  • FTSE +0.1%
  • Stoxx -0.1%
  • CAC -0.2%

German 10-year yields rose to 2.68%, highest since May 15. GBP/USD and EUR/USD weakened throughout the session.

 

Headlines to Watch

  • Trump Threatens 200% Pharma Tariff, Sparks FX Volatility
    President Trump intensified trade rhetoric, announcing a potential 200% tariff on pharmaceuticals and accusing BRICS nations of targeting the USD. Markets reacted with increased volatility across FX and commodities.

  • Copper Surges Over 17% on New U.S. Tariffs
    Copper rallied sharply after Trump’s announcement of a 50% tariff on the metal. Commodity currencies, especially AUD and CAD, saw support amid risk flows into metals.

  • RBNZ to Hold Rates; August Cut Still Possible
    The RBNZ is widely expected to keep the OCR at 3.25% today, with markets focusing on forward guidance. Analysts remain divided, with weak domestic activity suggesting room for further easing in coming months.

 

Mid-market rates.

Currency PairMid-market Rate
AUD/USD0.6522
AUD/NZD1.0891
AUD/JPY95.79
AUD/CNY4.6821
AUD/EUR0.5564
AUD/GBP0.4803
AUD/HKD5.1194

 

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