Canadian Highlights Donald Trump’s election victory means heightened macroeconomic uncertainty north of the border. Canada’s labour market put in a decent showing in October as the unemployment rate steadied, while job creation continues. A hefty increase in preliminary housing sales data for October may be proof that interest rate cuts are beginning to boost housing […]

The post The Weekly Bottom Line: Trump Victory Likely to Bring Big Policy Changes appeared first on Action Forex.

Summary In this report, we examine some thematic and global takeaways from the U.S. election. We view a second Trump administration—and more specifically his proposed tariff policies—as a catalyst for further deglobalization and global economic fragmentation. Tariffs could also act as an inflection point for China to approach stimulus efforts differently, while the nature of […]

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Summary of Election Results & Financial Market Reaction As of 11 AM ET, Donald Trump has secured 277 of the 538 Electoral College votes, becoming the 47th president. While ballots are still being counted, President Trump also looks to have won the popular vote, which has not happened for a Republican president since George W. […]

The post Markets Brace For Higher Inflation and Interest Rates Under President Trump appeared first on Action Forex.

The single currency has been one of the losers from Trump’s victory, losing 2% on Wednesday to 1.07, its lowest since July. And it’s not just a story of a strong dollar, with the euro also losing around 0.7% against the Swiss franc and 0.8% against the pound. The single currency’s weakness has been attributed […]

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Summary Election Day is in the rearview mirror. Although the outcome of every race has not yet been determined, the outlook for control of Congress and the White House has become considerably clearer. Donald Trump has been elected President of the United States. Republicans have picked up a majority of at least a few seats […]

The post The 2024 U.S. Elections: Economic Implications appeared first on Action Forex.

Summary We have written extensively about the deterioration in the trade relationship between the U.S. and China, and how tensions between the two nations have rewired global trade patterns. Following the implementation of Trump-era tariffs, the U.S.-China trade relationship reached an inflection point, and as of the end of 2023, China’s trade surplus with the […]

The post Is China Circumventing U.S. Tariffs? appeared first on Action Forex.

Summary President Biden recently hiked tariffs on $18 billion worth of imports from China, and former President Trump has vowed to implement a 60% tariff on China and an across-the-board 10% tariff on other trading partners should he return to the White House in 2025. What effects would these tariff increases have on the U.S. […]

The post Stagflation from Higher Tariffs: 1970s Redux? appeared first on Action Forex.

Summary United States: Another Week, Another Strong Showing from the U.S. Consumer Robust retail sales data were the main story on the U.S. economic data front this week. Elsewhere, data for industrial production and jobless claims offered additional evidence that the U.S. economy remains on solid footing. Next week: New Home Sales (Tue.), GDP (Thu.), […]

The post Weekly Economic & Financial Commentary: Another Week, Another Strong Showing from the U.S. Consumer appeared first on Action Forex.

In this piece, we argue that there is a high probability that the EU will increase the tariff on Chinese electric cars, but there are also good arguments why that might not lead to a large-scale trade war. The EU Commission has rung alarm bells over a doubling of the EU-China trade deficit over the […]

The post Buckle Up for EU-China Trade Tensions appeared first on Action Forex.

EU-China trade tensions are brewing with an EU probe into Chinese EV subsidies. US weapons sale to Taiwan under sovereign-nation program feeds new tensions. China has increased the intensity of military exercises around Taiwan lately. Ukraine has made significant advance in the battlefield, successfully breaking through the first Russian line of defence in the south. […]

The post Geopolitical Radar – EU-China Trade Tensions Brewing, Ukraine Makes Advance appeared first on Action Forex.

San Francisco Fed President Mary Daly said yesterday she’s “quite comfortable” with the economic projections that interest rate will rise to 4-4.5% by the end of this year, and 4.5-5% next. “It’s going to take restrictive policy for a duration of time to get clear and convincing evidence that inflation is getting back to 2% […]

The post Fed Daly: Going to take restrictive policy at least through next year appeared first on Action Forex.

China’s trade surplus soared to a record high of US$84.54B in October. Exports rose +27.1% y/y in October, down from +28.1% a month ago but exceeded consensus of +22.8%. Imports accelerated to +20.6% y/y from +17.6% in September. This, however, missed consensus of +26.2%. Concerning exports, shipment to EU jumped to +44.3% y/y in October, […]

The post China’s Trader Surplus Soared to Record High. 32 countries Scrapped Preferential Treatment amidst China’s Twisting of Trade Rules appeared first on Action Forex.

Summary United States: The U.S. Economy Continues to Push Through Supply-Side Headwinds During May, retail sales pulled back 1.3%, while industrial production rose 0.8%. Housing starts improved 3.6% in May, but the NAHB/Wells Fargo Housing Market Index slipped two points to 81 in June. The PPI for final demand advanced 0.8% in May. The FOMC […]

The post Weekly Economic & Financial Commentary: U.S. and E.U. End Aircraft Dispute to Form United Front Against China appeared first on Action Forex.

According to a statement by the Chinese Commerce Ministry, Commerce Minister Wang Wentao spoke with US Commerce Secretary Gina Raimondo on phone today, and agreed to promote healthy trade and cooperations. The statement said, they “agreed to promote the healthy development of pragmatic cooperation in trade and investment”. Both sides “exchanged views frankly and pragmatically […]

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Overall markets are mixed for now, except the clear strength in New Zealand Dollar this week. While Aussie is also trading higher against others, it’s lagging Kiwi by a mile. Dollar recovered overnight but once again lost momentum quickly. Canadian Dollar has also found some footing after yesterday’s pull back. In other markets, Asia markets […]

The post Dollar Recovered in Mixed Markets, Loonie Found Some Footing appeared first on Action Forex.

US Trade Representative Katherine Tai and Chinese Vice Premier Liu He held the first phone call in the Biden era. USTR said during their “candid exchange”, Tai “discussed the guiding principles of the Biden-Harris Administration’s worker-centered trade policy and her ongoing review of the U.S.-China trade relationship, while also raising issues of concern.” On the […]

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Looking through some intraday volatility, longer dated US yields and Bunds have traded sideways this week. European rates are finding themselves in a fragile limbo with inflation and ECB at the centre of the equation. We may have seen the first signs that the commodity boom is wearing off with both industrial metals and lumber […]

The post Weekly Focus – Supply Disruptions Continue as Commodities Show Signs of Peaking appeared first on Action Forex.

Commodity currencies are trading as the weaker ones for today so far, as risk markets turn softer. Major European indexes are in slight red,. while US futures point to lower open. Yen is currently the stronger ones, followed by Swiss Franc and then Dollar. But overall, major pairs and crosses are still generally stuck in […]

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EU said they will temporarily suspend the increase of its rebalancing measures on the US 232 steel and aluminum tariffs, imposed during the era of former US President Donald Trump. EU said, “this gives us space to find joint solutions to this dispute and tackle global excess capacity”. In the joint statement, EU Executive Vice […]

The post EU and US to hold China’s trade-distorting policies to account appeared first on Action Forex.

China’s official data suggest that the country’s economy recovered significantly in March. PMI readings for all of manufacturing, services and construction activities improved strongly. While seasonal factor (low base effect in February) played a role, the strong first quarter reading signals that economic recovery remains underway. Key risks are global vaccination progress and US-China trade […]

The post China’s Economic Activities Expanded Strongly in March. Trade Frictions and Pandemic Remain Key to Outlook appeared first on Action Forex.