Daily Analysis 14/04/2025

• GBP/USD Price: The British Pound continues to build on last week’s strength, with GBP/USD trading slightly above 1.3100 during Monday’s European session. The pair remains buoyed by positive UK data and a softer USD backdrop, holding near recent highs.
• US Labor Market: US jobless claims rose to 223,000, but continuing claims dipped to 1.85 million, painting a conflicted picture of labor market conditions. This dynamic contributes to broader USD uncertainty, especially as Fed policy remains highly data-sensitive.
• Fed's Kashkari: Minneapolis Fed President Neel Kashkari warned that the economic impact of Trump’s trade war hinges on how swiftly uncertainty is resolved. His comments underscore a data-dependent and cautious Fed stance, supporting short-term USD softness.
• UK GDP: February’s UK GDP jumped 0.5%, beating expectations and marking the strongest monthly growth in nearly a year. The expansion was broad-based, helping reinforce confidence in the UK’s economic resilience despite global headwinds.
• BoE Rate Cut: Stronger growth figures have prompted markets to scale back expectations for a May BoE rate cut, though a gradual easing path remains on the table. Traders now see slightly reduced odds for an immediate policy shift.

Closing statement: The GBP/USD pair is underpinned by solid domestic data and fading Fed rate cut bets, although uncertainty around US trade policy and global growth could trigger fresh volatility. Near-term, the Pound’s momentum appears intact above 1.3100, but the pair remains sensitive to any shifts in central bank rhetoric.

• XAU/USD Price: Gold prices are trading with a slight bearish bias, pulling back marginally below the fresh all-time high set earlier on Monday. The retreat reflects investor caution amid overbought technical conditions, with the daily RSI signaling stretched upside momentum.
• China Tariffs: China's Ministry of Finance sharply raised tariffs on US imports, escalating trade tensions once again. While such moves traditionally boost demand for safe-haven assets, the reaction in gold was muted due to broader market optimism on US-China talks.
• Trump's Concession: President Trump’s concessions on Chinese electronics, along with expectations of further Chinese stimulus, have slightly eased global market stress, tempering the urgency for safety trades and thus dulling gold’s appeal.
• US-Iran Talks: US envoy Steve Witkoff’s constructive dialogue with Iranian Foreign Minister Abbas Araghchi adds another layer of calm to geopolitical tensions. Markets viewed the discussion positively, and further negotiations are scheduled, slightly capping gold's upside.
• Upcoming Data: Gold traders now turn attention to China’s March trade figures, though the full brunt of tariff impacts may not yet be reflected. Additionally, upcoming speeches from multiple Fed officials could offer clues on rate path and affect gold sentiment in the short term.

Closing statement: Gold is consolidating after reaching new highs, as easing geopolitical risk and hopes for US-China de-escalation temporarily reduce safe-haven demand. However, the broader bullish trend remains intact, especially if Fed speakers signal policy easing or inflation risks ahead.

• Crude Oil Price: WTI crude oil prices are under pressure, giving up early gains and slipping near $61.60 at the start of the new trading week. The lack of follow-through buying highlights investor unease amid worsening global macro risks.
• Trade War: Mounting US-China trade tensions continue to weigh on sentiment, with fears that prolonged conflict between the two largest economies could stall global growth and thereby reduce oil consumption. Demand outlook is now central to oil pricing.
• EIA Forecast: The US Energy Information Administration revised its global oil demand growth forecast downward, projecting only 900k barrels/day in 2025 and 1 million barrels/day in 2026. The update reinforces concerns about a slowing demand recovery.
• US-Iran Tensions: US Energy Secretary Chris Wright suggested the US could block Iran’s oil exports, escalating tensions in the Middle East. While this raises supply disruption risks, the broader market remains more focused on softening global demand.
• FOMC Speakers: Traders are awaiting key Fed speeches, including remarks from Chair Jerome Powell on Wednesday, for clues on interest rate policy. The Fed’s stance could influence dollar strength and broader risk appetite, indirectly impacting oil prices.

Closing statement: Crude oil remains under selling pressure amid demand-side worries tied to trade war fallout, with limited upside despite geopolitical risks. Market participants will stay cautious ahead of Fed guidance and China’s economic indicators, which may offer direction for both macro sentiment and oil trajectory.

• DAX Price: The DAX fell 0.92% on Friday, trimming Thursday’s gains and closing the week down 1.30% at 20,384. Investors reacted negatively to rising tensions between the US and China, fearing that a full-scale trade war could hurt export-heavy German industries.
• German Inflation: Germany’s March inflation rate eased to 2.2%, down slightly from February’s 2.3%. The data matches preliminary estimates and reinforces expectations for a 25-basis point rate cut by the ECB on Thursday, April 17, in an effort to cushion growth risks.
• EU-US Trade Talks: Markets are eyeing Monday’s meeting between EU Trade Commissioner Maros Sefcovic and US officials, where progress or setbacks could directly affect sentiment toward European equities, particularly Germany’s export-oriented stocks.
• Tariff Details: President Trump is set to unveil specifics on semiconductor tariffs, with only a temporary exemption for consumer electronics like smartphones. The decision is likely to impact tech supply chains, including key German manufacturers and suppliers.
• Corporate News: On the corporate front, investors await the German Federal Cartel Office’s decision on UniCredit’s proposed acquisition of Commerzbank. A green light could reshape the German banking landscape, possibly lifting financial sector stocks.

Closing statement: The DAX enters the week on shaky footing as geopolitical tensions, upcoming central bank decisions, and corporate developments weigh on sentiment. EU-US trade negotiations and tariff clarity will be key near-term drivers for direction.