Daily Analysis 29/04/2025

• GBP/USD Price: The GBP/USD pair continues to pull back from its recent three-year peak of 1.3445, trading with a softer tone early Tuesday as the US Dollar stages a modest recovery amid cautious global sentiment.
• US Dollar: The US Dollar strengthens on improved risk appetite after China exempted some US imports from steep tariffs, reducing immediate concerns over trade tensions and supporting Greenback demand.
• Trade Talks: US Agriculture Secretary Brooke Rollins confirmed ongoing tariff discussions with China and noted trade agreements with other countries are nearing completion, offering a backdrop of tentative optimism.
• BoE Rate Cut: Market participants remain convinced the Bank of England will cut rates by 25 bps to 4.25% in May, limiting Sterling’s upside as monetary divergence with the Fed looms.
• BoE Speech: Investors are watching for comments from BoE's Dave Ramsden later today, with any dovish tone likely to weigh further on GBP/USD heading into the central bank’s next meeting.

Closing statement: With BoE rate cut expectations intact and the USD firming on easing trade tensions, GBP/USD remains vulnerable to further downside unless the BoE signals a more hawkish tone or global sentiment shifts favorably for risk assets.

• XAU/USD Price: XAU/USD continues its intraday descent, trading closer to the $3,300 level during Tuesday’s European session as risk sentiment improves slightly, undermining demand for safe-haven assets.
• Ukraine Ceasefire: Russian President Vladimir Putin’s 72-hour unilateral ceasefire announcement offered brief relief, though Ukrainian President Zelensky’s rejection limited the impact. The development still contributed to weaker gold interest.
• Fed Rate Cut: Markets are increasingly pricing in a Fed rate cut in June, which could boost non-yielding gold in the medium term. The Fed is currently in its blackout period ahead of the May 7 FOMC decision.
• Trade Tensions: Goldman Sachs warns Trump’s tariffs could put 16 million Chinese export jobs at risk, adding a layer of uncertainty to global trade, although it has yet to trigger renewed safe-haven flows into gold.
• US Labor Data: Traders await the release of the JOLTS Job Openings report later today for fresh clues on labor market strength, which could influence Fed policy expectations and gold price direction.

Closing statement: Despite short-term pressure from easing geopolitical fears, gold remains supported by expectations of Fed rate cuts. Upcoming US labor data and central bank decisions will be key to determining whether XAU/USD holds the $3,300 support or rebounds.

• Crude Oil Price: WTI crude prices are rangebound around $61.45 in Tuesday’s European session, lacking a clear intraday direction after hitting a 1.5-week low on Monday, as traders weigh supply and geopolitical developments.
• OPEC+ News: Reports suggest several OPEC+ members may push for a second month of accelerated output hikes in June, which continues to cap oil prices amid rising concerns about oversupply.
• Iran Nuclear Talks: Perceived progress in US-Iran nuclear negotiations is amplifying oversupply fears, adding downward pressure on crude as markets speculate on potential increases in Iranian oil exports.
• Auto Tariffs: A Reuters report suggests President Trump could soften auto tariffs, particularly on foreign-made cars and imported parts, signaling a possible easing of trade tensions, which could support broader risk sentiment but has limited direct impact on crude for now.
• US Data: Traders are awaiting Q1 GDP and April jobs data, which could shape Fed expectations and indirectly influence crude prices by signaling the health of US economic activity and energy demand.

Closing statement: Crude oil remains under downward pressure amid rising supply risks, but broader market direction could hinge on upcoming US economic data. Traders should watch for signs of demand resilience or further easing of trade policy for short-term positioning.

• DAX Price: The DAX rebounded sharply to 22,443, marking a 21% recovery from its monthly low and returning to the level where its early-April decline began. This signals a potential shift in sentiment after weeks of tariff-related volatility.
• Consumer Sentiment: GfK consumer sentiment for May came in at -20.6 vs -26.0 expected, reflecting a notable improvement. However, GfK cautioned that ongoing tariff uncertainty continues to weigh heavily on the broader economic outlook.
• Corporate Earnings: Deutsche Bank beat Q1 profit expectations, providing a positive corporate backdrop. Meanwhile, Adidas reaffirmed its yearly outlook, but flagged downside risks from US tariffs, echoing broader corporate concerns.
• Canada Elections: Mark Carney’s potential election as Canada’s new PM adds a fresh dynamic to North American trade ties. His plan to meet Trump on economic and security matters could shape future market narratives, especially in transatlantic trade-sensitive sectors.
• US Trade Data: Investors await the US trade balance report, which could offer early insights into the effects of Trump’s trade war. A widening deficit may stir risk-off sentiment, while signs of improvement could support equities.

Closing statement: The DAX is staging a strong technical recovery, but tariff-related uncertainty and upcoming US data releases remain key drivers. Sustained gains will depend on clearer trade signals and resilience in corporate earnings.