ForexLive Asia-Pacific FX news wrap: USD/JPY dropped under 149.00

• Nasdaq Futures Today: Key Price Levels
• CBA forecasts three more RBA rate cuts in 2025: May, August and November
• Reminder - Reserve Bank of Australia Deputy Governor Hauser is speaking tomorrow
• European Central Bank meeting this week - "Cheat sheet"
• CEO of Australia's largest bank expects RBA rate cuts not coming until later in the year
• Canada confirms 25% retaliatory tariffs on US imports if Trump's imposts go into effect
• ECB to cut by 25bp this week - focus is on signalling what's to come
• J.P. Morgan sees Gold near US$3,000 by late 2025, maintains bullish outlook
• PBOC sets USD/ CNY central rate at 7.1739 (vs. estimate at 7.2727)
• China’s Commerce Ministry will take “necessary countermeasures” on Trump's higher tariffs
• UK retail prices set to rise as costs increase
• Australia’s Retail Sales rebound in January, rising 0.3% m/m vs. 0.3% expected
• RBA rate cut in February - weight placed on downside risks to economy
• Japan Q4 Corporate Capex falls 0.2%, tepid domestic demand
• Goldman Sachs CEO Solomon says chance of a 2025 US recession is not zero
• More background on why Trump threatened Japan and China over currency deprecation
• Goldman Sachs vs. the Reserve Bank of Australia (OK, not really)
• The US has 'paused' all current military aid to Ukraine
• Japan finance minister Kato says Japan is not devaluing the yen
• Japan January Unemployment Rate 2.5% (vs. 2.4% expected)
• Trump's threat to Japan (re the weak yen) was forewarned during Asia on Monday morning
• South Korea January industrial output and retail sales both decline
• Australian weekly consumer sentiment survey dropped to 87.7 (prior 89.8)
• Australian Q4 GDP growth data expected to remain soft, seen strengthening in 2025
• Things Trump is trashing faster than equities, #1: Atlanta Fed GDP tracker now at -2.8%
• Forexlive Americas FX news wrap: US data sags, tariffs loom and OPEC+ pumps more
• New Zealand January building permits +2.6% m/m (Prior -5.6%)
• Canada - Ontario Premier Ford says will completely halt export of nickel to the US
• Nasdaq erases all the gains since the election in bruising day
• China dampens fiscal stimulus hopes with article on deficits
• Trade ideas thread - Tuesday, 4 March, insightful charts, technical analysis, ideas

The deadline for Trump’s 25% tariffs on neighbours Mexico and Canada is barely an hour away, with no indication of any postponement this time. They are due to impact from 12.01 am US Eastern time on Tuesday, March 4, 2025.

Markets in Asia spent the day digesting the Monday news of Trump confirming that tariffs are on the way, and also that he was bumping up tariffs on imports from China to 20%.

• China’s Commerce Ministry said it would be taking retaliation steps against Trump’s fresh imposition of higher US import tariffs.
• Canada’s Prime Minister issued a statement outlining Canada’s reciprocal tariffs against Trumps’ tariffs.

Also in Trump’s Monday remarks were threats against China and Japan over currency devaluation/depreciation. The yen appreciated in Monday US trade on the comments, and that move followed through today here in the timezone. Both Japan finance minister Kato and PM Ishiba disputed Trump’s accusations. Over many years Japan has denied its ultra-loose monetary policy is aimed at weakening the currency, and that its instead aimed at combatting deflation and low inflation. The weak yen is just a side-effect. None of Japan’s G7 partners have publicly disputed Japan’s account. USD/JPY dropped to lows just under 148.70 before bouncing back above 149.00.

Major FX otherwise traded in small ranges only.

From Australia we had minutes of the Reserve Bank of Australia’s February meeting, where the Bank cut its cash rate for the first time since November 2020. A key takeaway, for me, from the minutes was the unsurprising talk that the Bank would be taking a slow and cautious approach to rate cuts ahead, citing still present risks of inflation. FWIW I think the global economy, and the RBA in turn, will be swamped soon enough by the negative impacts of Trump’s imminent trade war and rate cuts may come ahead of the RBA’s current reckoning. By the way, Reserve Bank of Australia Deputy Governor Hauser is speaking again tomorrow, Wednesday, March 5, 2025 at 8.45 am Sydney time (2145 GMT / 1645 US Eastern time). We’ll likely get more from him to hint at the outlook.