Markets turned sour Friday to close out a volatile week, with US equities falling sharply, overwhelmed by the looming trade wars. Canada and Mexico enjoyed a temporary reprieve, from 25% tariffs, by agreeing to immediate border restrictions, while negotiations for the massive trade deficits continue. The US has imposed 10% sanctions on China and the next big tariff threat, will be the EU and possibly the UK. Europe can ill afford a trade war, as their economies languish in a two year long-plus economic recession, with no real light at the end of the proverbial tunnel. The USD regained some mojo, with the GBP slipping back below 1.2400, while the EUR headed back towards 1.0300.The rising reserve continues to impact the commodity currencies, with the AUD heading back towards 0.6250, while the NZD settled back on 0.5650. Non-Farm Payroll numbers were revised lower by more than 500,000, for the year 2024, shocking many. This coming week will be highlighted by GDP growth numbers, out in the UK and Europe, and these only promise to confirm recessionary economic conditions will prevail. US inflation data will also be released, and this will probably show a rise in inflation in the US. Tariff wars are likely to dominate the global economic narrative once again, this week.
