| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 10:00 | Australia | RBA Gov Bullock Speaks | | | | |
USD declined against most of its major rivals in the European session on Thursday, as investors continued to digest Wednesday's late-day decision of U.S. President Donald Trump to suspend most of his recently imposed tariffs while awaiting the release of the U.S. March consumer price index (CPI) report later in the day.
The U.S. Dollar Index (DXY), which measures the U.S. currency's value relative to a basket of foreign currencies, fell 0.88% from its previous close to 101.99.
U.S. President Trump paused most of his reciprocal tariffs for 90 days, boosting hopes for diplomatic talks with major trading partners, which would allow avoiding an imminent global trade war and recession. However, the strains in U.S.-China trade relations intensified as Trump raised tariffs for Chinese goods to 125%.
Against this backdrop, optimism rose that trading partners will manage to strike deals with the U.S., and the final tariff rates will ultimately be lower than threatened today. These expectations, however, do not completely dismiss concerns about the tariff war’s damage to the U.S. economy.
The European Union responded to Trump’s decision with a 90-day pause in its countermeasures against U.S. tariffs, which were agreed only yesterday. “We want to give negotiations a chance,” steed the European Commission’s president von der Leyen. “If negotiations are not satisfactory, our countermeasures will kick in,” she added.
Later in the day, investors will receive a crucial report on the U.S. CPI for March, which could impact markets’ bets on the Federal Reserve’s policy path. Economists expect the headline CPI to show a 2.6% gain YoY, down from 2.8% YoY in February, and the core CPI, which strips out food and energy prices, to post a 3.0% YoY advance, marginally down from 3.1% YoY in February.
According to CME FedWatch, the U.S. central bank is widely expected to keep its rates unchanged at its May 6-7 meeting and to cut them by 25 basis points at June 17-18 meeting. The second cut is seen in July, and the third in the autumn.
Today’s CPI report will be followed by the producer price index release on Friday.