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Markets Respond to Tariff Shifts and Eurozone Stability (04.10.2025)

Global markets showed mixed reactions as trade tensions deepened despite a temporary U.S. tariff pause. 

The euro held firm near $1.0980, backed by political stability in Germany and the EU’s retaliatory measures. The yen strengthened after Japan was granted a reduced tariff rate, while gold surged above $3,095 on safe-haven demand. Silver remained volatile amid stagflation fears, and the British pound steadied ahead of key inflation data. Investors now turn to U.S. CPI for fresh policy clues.

TimeCur.EventForecastPrevious
1:30  CNYCPI (YoY) (Mar)0.00%-0.70%
9:15  EURECB Supervisory Board Member Tuominen Speaks    
12:00  EURGerman Buba Vice President Buch Speaks    
12:30  USDContinuing Jobless Claims1,880K1,903K
12:30  USDCore CPI (MoM) (Mar)0.30%0.20%
12:30  USDCore CPI (YoY) (Mar)3.00%3.10%
12:30  USDCPI (MoM) (Mar)0.10%0.20%
12:30  USDCPI (YoY) (Mar)2.50%2.80%
12:30  USDInitial Jobless Claims223K219K
14:00  USDFOMC Member Bowman Speaks    
16:00  USDWASDE Report    
16:30  USDFOMC Member Harker Speaks    

Euro Steady as EU Retaliates on Tariffs

The euro hovered around 1.0980 on Thursday, supported by rising trade tensions and renewed political stability in the Eurozone. Sentiment favored the currency after China raised tariffs on all U.S. goods to 84% from 34%, retaliating against Washington’s hike to 104% on Chinese imports. The European Commission also approved retaliatory tariffs on €21 billion worth of U.S. goods, including soybeans, motorcycles, and orange juice. The escalation pushed investors away from typical safe havens like the dollar and Treasuries. Political stability in Germany further supported the euro, as the CDU/CSU and SPD finalized a coalition, clearing the way for Friedrich Merz to become Chancellor next month. The ECB is also expected to cut rates by 25 basis points later this month.

Key resistance is at 1.1020, followed by 1.1100 and 1.1150. Support lies at 1.0880, then 1.0810 and 1.0730.

R1: 1.1020S1: 1.0880
R2: 1.1100S2: 1.0810
R3: 1.1150S3: 1.0730

Yen Climbs as Trump Softens Stance on Japan Tariffs

The Japanese yen strengthened past 147 per dollar on Thursday, moving in a volatile range as trade tensions persisted. Markets reacted to President Trump’s 90-day pause on tariffs for non-retaliating countries, offering Japan some relief with a reduced 10% baseline tariff. However, tensions remained elevated as Trump raised tariffs on Chinese imports to 125% in response to Beijing’s retaliation. The EU may be excluded from the pause due to its own countermeasures. Meanwhile, the U.S. confirmed plans to begin trade talks with Japan after Trump’s call with Prime Minister Shigeru Ishiba.

Key resistance is at 148.70, with further levels at 152.70 and 157.70. Support stands at 145.60, followed by 143.00 and 141.80.

R1: 148.70S1: 145.60
R2: 152.70S2: 143.00
R3: 157.70S3: 141.80

Gold Jumps 3% on U.S.-China Tariff Battle

Gold jumped over 3% to above $3,095 per ounce on Wednesday as U.S.-China trade tensions escalated. President Trump announced a 90-day tariff pause and a reduced 10% rate for all but China, which now faces a 125% tariff. Treasury Secretary Bessent said the lower rate would apply during talks, excluding China and some sectors. In response, China raised tariffs on U.S. goods to 84%, and the EU approved levies on €21 billion worth of American exports. Fed minutes showed policymakers expect higher inflation from tariffs but remain uncertain about its scale and duration.

Supporting gold’s rally further, the World Gold Council reported that gold-backed ETFs attracted 226.5 metric tons in inflows during Q1, totaling $21.1 billion in value.

Key resistance is at $3,135, followed by $3,165 and $3,200. Support stands at $3030, then $3010 and $2956.

R1: 3135S1: 3030
R2: 3165S2: 3010
R3: 3200S3: 2956

GBP/USD Awaits CPI After Tariff-Driven Gain

GBP/USD hovered near 1.2830 on Thursday morning, holding its upward momentum for a third straight session. The pair remained supported as market sentiment improved following Trump’s tariff pause. All eyes are now on today’s U.S. inflation data, which is expected to influence the next move.

If GBP/USD breaks above 1.2860, resistance levels are at 1.2900 and 1.2940. Support is at 1.2715, followed by 1.2650 and 1.2600.

R1: 1.2860S1: 1.2715
R2: 1.2900S2: 1.2650
R3: 1.2940S3: 1.2600

Silver Remains Volatile Amid Trade War and Recession Fears

Silver stayed above $30.50 per ounce on strong safe-haven demand amid U.S.-China trade tensions. Prices held a 3.5% gain after President Trump announced a 90-day tariff pause and a 10% rate for all but China, which now faces a 125% tariff. China raised tariffs on U.S. goods to 84%, and the EU approved duties on €21 billion of American exports. Fed minutes showed concerns about stagflation and the impact of Trump’s trade policies. Markets now await March U.S. inflation data on Thursday for clues on the Fed’s next move.

Technically, the first resistance level is located at 31.50. In case of its breach 32.15 and 33.30 could be monitored respectively. On the downside, the first support is at 30.20. 29.50 and 29.20 would become the next support levels if this level is passed.

R1: 31.50S1: 30.20
R2: 32.15S2: 29.50
R3: 33.30S3: 29.00
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