As inflation heats up and market uncertainty deepens, investors flee to safe havens like the yen, awaiting fresh tariff moves from the White House next week.
March 29, 2025: Key Points:
- Dollar dips against yen and euro on growth concerns and market volatility
- President Trump set to announce new reciprocal tariffs on April 2
- Core inflation rises 0.4% in February, stoking stagflation fears
- Safe-haven yen surges, posting its best daily gain in weeks
- Euro supported by technicals despite weak inflation in France and Spain
- Bitcoin drops 4% to $83,783 amid broader market unease
📉 Forex Market Wobbles as Trump’s Tariff Clock Ticks
The U.S. dollar weakened sharply on Friday as investors braced for U.S. President Donald Trump’s reciprocal tariff announcement due next week. The Japanese yen rallied strongly, benefiting from risk aversion as stocks tumbled and Treasury yields slipped.
The dollar dropped 0.69% against the yen, landing at 150.01, on track for its biggest daily decline versus the Japanese currency in nearly a month.
Market participants remain cautious over the ambiguity of Trump’s tariff language.
“The one word I keep hearing is uncertainty,” said Marc Chandler of Bannockburn Global Forex. “We know tariffs are coming April 2 — we just don’t know how severe.”
🛑 Core Inflation Adds to Jitters
Fresh U.S. data showed core inflation rose 0.4% in February, above expectations, while headline inflation rose 0.3%. A University of Michigan survey showed 12-month inflation expectations hitting a 2.5-year high.
Also Read: Rupee Set for Biggest Monthly Gain Since 2018 Amid Strong FII Inflows
🌍 Global Reactions: Euro, Sterling, Bitcoin
- The euro climbed 0.2% to $1.0823, buoyed by technical support despite weak inflation data in France and Spain
- The British pound fell to $1.2935 as retail sales surprisingly rebounded but broader economic growth remains sluggish
- Bitcoin dropped 4.03% to $83,783, tracking broader risk-off sentiment in global markets
📊 What’s Next?
With Trump’s 25% tariff on imported vehicles set to start April 3, markets await whether additional tariffs will be targeted or broad-based. Analysts warn that across-the-board levies would be a major negative surprise, possibly derailing fragile global recovery hopes.
“We don’t expect sustained dollar strength if growth fears persist,” said analysts from Bank of America.
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