Market comment on behalf of Ruben Ferreira – Head of Portuguese Operations at FlowCommunity
7th March 2025
The US Dollar remained under pressure, hovering at a four-month low as market participants weighed global trade tensions and mixed US economic data. Amidst ongoing trade tensions, US President Donald Trump postponed tariffs on auto tariffs for another month. This ongoing uncertainty in trade policy could cloud the short-term outlook for the greenback.
Additionally, retaliatory measures from China, Mexico and Canada could dampen US growth prospects, potentially pushing the Federal Reserve toward a more accommodative stance and adding pressure on the dollar. Yesterday’s ADP employment report showed the weakest job growth in seven months, pointing to a cooling labor market.
All eyes are now on tomorrow’s Nonfarm Payrolls, which could play a crucial role in shaping market sentiment. Weak results could weigh on the dollar, while strong figures could boost yields and lend support to the currency.
Elsewhere, the euro strengthened as German bond yields surged following the announcement of a EUR 500 billion infrastructure fund, signaling fiscal expansion and boosting investor confidence.