Collinson FX: May 30: Trump in Court battles, loses Court order
by Collinson FX 29 May 16:14 PDT
29 May 2025
NZ Nationals - RS Feva - Murrays Bay - May 11-12, 2025 © Justin Mitchell
www.justinmitchell.co.nz - Instagram: @jl_mitchell_
Collinson FX: May 30: Tariffs temporarily hit by Court Order
Markets were shaken by the latest court order, in the USA, by the US Court of International Trade. This effectively halted the Trump tariffs and was a boost to many Countries, that do not have a trade agreement with the USA. (S-W Update: On May 29, 2025, a federal appeals court temporarily reinstated President Donald Trump's tariffs.)
The US Dollar was in retreat, as the EUR moved back above 1.1350, and the GBP looked to regain 1.3500. The Trump administration immediately filed an appeal, which will be heard under urgency, making this ruling interim.
The Trump administration is fighting a full-on judicial war, which may be decided by SCOTUS, or through the legislature. Trump met with Fed Chairman Powell, who steadfastly maintained monetary policy would be free of politics and impartial. Trump would have laid down the law to Powell, either backs down, or he will suffer the full force of the Presidency.
The disruption in tariffs was good for the trade exposed commodity countries, which have no Free Trade Agreement, with the USA. This was a boost to the currencies, with the AUD close to regaining 0.6450, while the NZD is heading back to the strategic 0.6000.
All eyes are on the US appeals Courts, while markets watch inflation data from the USA and Germany, to be released later today.
Collinson FX: May 29: Markets ease following EU Tariff softening
Markets were softer overnight, after posting big gains in the previous session, due to the delay in EU sanctions.
German and EU Consumer Confidence remains in the doldrums, while French Q1 GDP growth was conveniently 0.1%, there by marginally missing technical recession territory. It is the trends in the data that reveal the story, as actual numbers are open to manipulation, as seen in the last few years in the USA. The US Dollar regained some ground, with the EUR slipping below 1.3000, while the GBP retraced to 1.3450.
The RBNZ acting in line with expectations and cut rates a further 25 basis points, in an attempt to stimulate the faltering economy. The RBNZ have cut 225 basis points, since the loosening in monetary policy began, but now face the threat of resurgent inflationary pressures. Recent data has pointed to growing inflationary pressures, with costs on the rise, while the Central Bank warned of further pressures from the ongoing global trade wars. The latest inflation report in Australia showed inflation was no longer in retreat.
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