 Global financial markets are rocked by Trump's decision to use tariffs as a way to force Mexico to solve border security crisis of the US. 5% tariffs will be imposed in all Mexico imports to US starting June 10, then "gradually" as Trump claimed, go up to 25% on October 1. The implications to some is huge as Trump is now using tariffs for non-economic issues. It's much more than just protectionism. On the other hand, the never-ending trade negotiations are going nowhere after the collapse and China is preparing more retaliations. The positive news, though, is that US economy data released remain solid. To talk about the seriousness of today's moves, firstly, Mexico Peso sank as much as 3% today while CDS was pushed to two-month high. German 10-year yield dived to new record low at -0.212 even though it gradually climbed above above -0.2 handle. European indices are all in deep red. DOW opens down -250 pts or -1% and is set to press 24900. US 10-year yield gaps down and reaches as low as 2.161 so far. 2% handle is not far away. In the currency markets, Yen and Swiss Franc are the strongest ones. But Euro is following closely, partly helped by rally in EUR/GBP. Canadian Dollar is the weakness one for today, with WTI crude oil breaching 55 handle. Sterling is the next weakest as selloff resumes. Dollar is indeed the third weakest, decoupling from Yen and Franc. In Europe, currently, FTSE is down -1.02%. DAX is down -1.75%. CAC is down -1.40%. German 10-year yield is down -0.021 at -0.192. Earlier in Asia, Nikkei dropped -1.63%. Hong Kong HSI dropped -0.79%. China Shanghai SSE dropped -0.24%. Singapore Strait Times dropped -0.80%. Japan 10-year yield dropped -0.0161 to -0.098. | 
No comments:
Post a Comment