Asia FX extends gains as dollar slumps.
Asian currencies extended gains on Friday as the U.S. dollar held near six-month lows, pressured by mounting fears that President Donald Trump’s sweeping tariffs could push the global economy toward a recession.
Asian currencies closed higher on Thursday, after falling initially on Trump tariffs announcement.
The US Dollar Index, which measures the greenback against a basket of major currencies, fell 0.4% in Asian trade on Friday after plunging nearly 2% to a six-month low on Thursday.
The moves came after President Trump on Wednesday announced a universal 10% tariff on all imports, alongside steep country-specific levies, reaching up to 54% on Chinese goods.
The aggressive trade measures sparked a sharp selloff in U.S. equities, with major indices posting their worst session in months. Investors scrambled toward safe-haven assets, driving down U.S. Treasury yields and weighing on the dollar.
Market participants fear that the trade escalation could curb corporate investment, slow global growth, and increase inflationary pressures.
Bitcoin price today ticks down to $83k.
Bitcoin inched lower on Friday amid a deepening global rout as U.S. President Donald Trump’s sweeping reciprocal tariffs fuelled recession fears and drove investors away from riskier assets.
The world’s largest cryptocurrency edged 0.3% lower to $83,121.50 by 01:50 ET (05:50 GMT)
Trump’s steep tariffs stoke global recession fears; US payrolls data awaited
President Trump on Thursday announced a comprehensive overhaul of U.S. trade policy, introducing a 10% universal tariff on all imported goods, effective April 5, 2025.
Trump also announced reciprocal tariffs targeting specific nations deemed to have significant trade barriers against U.S. products will take effect on April 9, 2025. These reciprocal tariffs are approximately half of the rates those countries impose on U.S. exports.
Dollar swoons as traders weigh tariff fallout.
The U.S. dollar sank on Friday and the safe-haven yen strengthened towards a six-month peak, as traders weighed the fallout from President Donald Trump’s aggressive and far-reaching new tariff measures.
The dollar slipped toward a six-month trough against the euro prior to the release of a crucial monthly U.S. payrolls report later in the day that will offer clues to the health of the economy and the outlook for monetary easing.
Traders now predict four quarter-point interest rate cuts from the Federal Reserve in the remainder of this year and reduced the odds of further Bank of Japan tightening to almost nil.
The risk-sensitive Australian and New Zealand dollars plunged.
Shockwaves from Trump’s harsher-than-expected tariffs were still rippling through markets more than 24 hours after being unveiled.
Stocks took the brunt of a searing selloff, driving investors to the safety of assets such as bonds and gold on fears that a full-blown trade war could trigger a global slowdown and stoke inflation.
The dollar had already been on the backfoot this year after initial euphoria over Trump’s policy agenda turned into worry that his focus on trade barriers could lead to stagflation, or even a U.S. recession.
The dollar index, a measure of the currency against a basket of six major peers, plunged 1.9% on Thursday, its worst day since November 2022, and was down a further 0.3% in the latest session.
The dollar weakened 0.31% to 145.65 yen by 0440 GMT. It slumped 2.2% in the prior session, at one point dipping as low as 145.19 yen for the first time since October 2.
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