US markets react positively to President Trump’s latest steel and aluminium tariff announcement, but uncertainty remains. Gold hit a new record high overnight. The British Pound continues to weaken following the Bank of England’s rate cut last week.
In our bonus deep dive interview, ANZ’s Senior Commodities Strategist Daniel Hynes unpacks the implications of Trump’s tariffs on aluminium and steel, if enacted, and who might be the winners and losers.
5 things to know in 5 minutes:
US stocks rose after US President Donald Trump’s announcement that 25% tariffs will be placed on US steel and aluminium imports. ANZ Head of G3 Economics Brian Martin says the market is trying to look on the bright side, saying sector-targeted tariffs will have less inflationary impact than universal application.
Gold hit a new record high overnight of US $2,937 an ounce. Brian says while the market reacted relatively positively to the tariff news, it hasn’t halted a flight to safety amid ongoing uncertainty.
The British pound or sterling is having a tough time vs the US dollar, with the Bank of England cutting interest rates as the Fed holds. ANZ Head of FX Research Mahjabeen Zaman sees sterling’s weakness continuing.
Mahjabeen says the market is focusing on one particular member of the Bank of England’s monetary policy decision-making committee.
Consumers in China remained cautious during the key Lunar New Year holiday, says ANZ Economist Vicky Xiao Zhou, who has dug through the transaction figures for spending on movies, flights, cars and appliances. She says deflation remains an ongoing issue.
Cheers,
Bernard
PS: Catch you tomorrow as we look ahead to how January CPI data could affect US rate cut expectations.
