On Thursday, President Trump decided to impose tariffs on steel and aluminum imports, fueling fears over a trade war. Indeed, China, Canada and Europe said that they will retaliate. Market attention now turns to the Italian elections and the results of Germany’s SPD vote on Sunday.
Greenback and Loonie Tumble on Steel and Aluminum Tariffs
The dollar underperformed all but one of the other G10 currencies after US President Trump’s decision to impose tariffs on aluminum and steel. The main gainers were NZD, NOK and JPY in that order. The greenback ended the day virtually unchanged against CAD, which was also hit by the decision.
Yesterday, US President Donald Trump announced that he will impose a 25% tariff on steel and 10% on aluminum imports, causing market turbulence. Remember that on the 16th of February, when the US Commerce Department recommended such tariffs, the dollar strengthened, with many attributing the currency’s gains to that, since raising the price of such commodity inputs is likely to drive inflation higher.
Read the full financial markets daily report on JFD Research.