Euro Stays Strong, While Markets Stabilize on Chinaâs Stimulus and Hopes for Trumpâs Tariff Compromise
| Action Insight Daily Report 3-5-25 |
Euro Stays Strong, While Markets Stabilize on China’s Stimulus and Hopes for Trump’s Tariff Compromise |
Despite the steep selloff on Wall Street overnight, sentiment appears to have improved somewhat in Asia. Investors found reasons for optimism as China set a 2025 GDP growth target of around 5% and announced stimulus measures to counter escalating tensions with the U.S. In a notable shift, Beijing raised its budget deficit target to roughly 4% of GDP, marking the highest level since at least 2010. Stocks in Hong Kong led regional gains, reflecting hopes that China’s commitment to boosting domestic growth will help offset some global headwinds. In the US, there is cautious optimism following remarks from Commerce Secretary Howard Lutnick, who revealed that President Donald Trump may unveil a compromise deal with Canada and Mexico as early as Wednesday. Such a pact could potentially scale back the recently enacted 25% tariffs. However, any progress on that front may be overshadowed by the looming threat of reciprocal tariffs, particularly on the EU, set to be announced in early April. While US equity futures received a minor lift from Lutnick’s comments, investors remain wary that ongoing protectionist policies could still drive the economy toward recession. Upcoming US ISM services data will be a crucial test for investor confidence, as weak results could deepen economic concerns and overshadow any positive developments on trade negotiations.... |
EUR/USD Daily Outlook Daily Pivots: (S1) 1.0522; (P) 1.0575; (R1) 1.0679; More... EUR/USD's current upside acceleration argues that bullish trend reversal is probably already underway. Intraday bias stays on the upside for 100% projection of 1.0176 to 1.0531 from 1.0358 at 1.0173. Decisive break there will solidify this bullish case and target 161.8% projection at 1.0932 next. On the downside, below 1.0527 resistance turned support will turn intraday bias neutral again first. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 00:30 | AUD | GDP Q/Q Q4 | 0.60% | 0.50% | 0.30% | | 00:30 | JPY | Services PMI Feb F | 53.7 | 53.1 | 53.1 | | 01:45 | CNY | Caixin Services PMI Feb | 51.4 | 50.8 | 51 | | 07:30 | CHF | CPI M/M Feb | 0.50% | -0.10% | | 07:30 | CHF | CPI Y/Y Feb | 0.20% | 0.40% | | 08:50 | EUR | France Services PMI Feb F | 44.5 | 44.5 | | 08:55 | EUR | Germany Services PMI Feb F | 52.2 | 52.2 | | 09:00 | EUR | Eurozone Services PMI Feb F | 50.7 | 50.7 | | 09:30 | GBP | Services PMI Feb F | 51.1 | 51.1 | | 10:00 | EUR | Eurozone PPI M/M Jan | 0.30% | 0.40% | | 10:00 | EUR | Eurozone PPI Y/Y Jan | 1.40% | 0% | | 13:15 | USD | ADP Employment Change Feb | 140K | 183K | | 13:30 | CAD | Labor Productivity Q/Q Q4 | 0.30% | -0.40% | | 14:45 | USD | Services PMI Feb F | 49.7 | 49.7 | | 15:00 | USD | ISM Services PMI Feb | 53 | 52.8 | | 15:00 | USD | Factory Orders M/M Jan | 1.50% | -0.90% | | 15:30 | USD | Crude Oil Inventories | 0.6M | -2.3M | | 19:00 | USD | Fed's Beige Book |
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