ForexLive European FX news wrap: Dollar down as risk picks up ahead of tariffs deadline

Headlines:

• Dollar stays on the backfoot to kick start the week
• A new week and new month but same old episode of drama
• Weekly update on interest rate expectations
• What’s happening in central bank land in March?
• SNB total sight deposits w.e. 28 February CHF 437.4 bn vs CHF 438.1 bn prior
• Eurozone February preliminary CPI +2.4% vs +2.3% y/y expected
• Eurozone February final manufacturing PMI 47.6 vs 47.3 prelim
• UK February final manufacturing PMI 46.9 vs 46.4 prelim
• UK January mortgage approvals 66.19k vs 65.65k expected

Markets:

• EUR leads, JPY lags on the day
• European equities higher; S&P 500 futures up 0.6%
• US 10-year yields up 2.7 bps to 4.253%
• Gold up 0.6% to $2,874.58
• WTI crude up 0.2% to $69.88
• Bitcoin down 1.2% to $92,163

It was a session light on headlines but the market moves are certainly keeping things interesting to start March trading.

With month-end flows out of the way, the dollar is lagging across the board ahead of Trump’s tariffs deadline against Canada and Mexico tomorrow. The yen is also sliding across the board after having held steadier in the earlier half of European morning trade. This comes with US futures ticking higher as we look towards the session ahead.

EUR/USD had already opened higher today to around 1.0420 before climbing further to 1.0460 levels now, up 0.9% on the day. Towards the upside, the 1.0500 mark still poses a key resistance point alongside its 100-day moving average at 1.0521 currently.

Meanwhile, GBP/USD is also seen racing higher and moving past its own 100-day moving average now to 1.2670 – up 0.7% on the day. USD/CAD is down 0.2% to 1.4435, still somewhat held by large option expiries as we await more tariff headlines.

As for USD/JPY, the pair was holding around 150.50 earlier but has now tracked higher to 151.20, after buyers stepped in on a test of 150.00 during the session.

In other markets, S&P 500 futures are up 0.6% at the highs currently as investors are keeping the optimism to start the new week/month.

US commerce secretary Lutnick said over the weekend that while Trump is going to stick with tariffs this week, “exactly what they are, we’re going to leave that for the president and his team to negotiate”. It’s a suggestion that perhaps we won’t see it be the full 25% tariffs anticipated.

With the dollar down, gold is also seen rebounding slightly to $2,874 on the day. Sellers are still in near-term control though, so we’ll see if the bounce here can lead to anything with plenty of obstacles still to follow on the week.

Trump’s plan on tariffs will steal the headlines later today but keep in mind that we also still have the US ISM manufacturing PMI data as well, on what will be a big week of economic data. It’s non-farm payrolls week after all.

This article was written by Justin Low at www.forexlive.com.