US: Focus Now On Appeal, Other Tariff Avenues, Potential Tariff Refunds
May-29 01:55
A few snippets from various media outlets post the earlier US Trade court decision against Trump's reciprocal tariffs.
- Politico: "The Justice Department quickly filed an appeal, setting the stage for more legal arguments over the extent of Trump’s tariff authorities. Ultimately, the case could end up at the Supreme Court."
- It was added: "The court’s ruling also means that the government may have to pay back duties it has already collected. “Anybody that has had to pay tariffs so far will be able to get them refunded,” said Ilya Somin, a professor of law at George Mason University, who helped argue a case against the tariffs brought by several small businesses."
- On other tariff avenues: "The ruling also does not affect other tariffs Trump has imposed, such as those under Section 232 of the Trade Expansion Act of 1962, which allows the president to levy new duties on national security grounds. Trump used the provision in March to widen existing steel and aluminum tariffs and slap a 25 percent duty on foreign auto imports. The administration has launched several other Section 232 investigations that could lead to future tariffs on semiconductors, pharmaceuticals and a number of other products.
- That process is slower, however, requiring the administration to first conduct a national security review and solicit public comment before moving forward with the duties. Using the emergency law allowed the White House to act much more quickly." (see this link for more details).
- The WSJ added: "If upheld, the ruling means the Trump administration must find another justification for its global tariffs. The administration has previously contemplated imposing duties under Section 301 of the Trade Act of 1974, which allows for tariffs that counter unfair foreign trade practices. That is the provision Trump used to underpin his first term tariffs on China and is considered to be on firmer legal footing than IEEPA." (see this link).
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CANADA: Vote Counting Begins In Larger Provinces
Apr-29 01:49
Election results have been trickling in from Canada’s Atlantic provinces with little change in seats. Polls have just closed now in the more populous regions of Ontario and Quebec. So far the incumbent Liberal party of PM Carney is on 51.3% of the vote leading in 56 districts, but the Atlantic favours his party, while the Conservatives are on 39.7% leading in 42 districts with one gain from the Liberals, according to CBC. A party needs to be elected in 172 seats to win majority government and with only 28 called so far, there is still a long way to go.
USD: The USD - Failing At Resistance
Apr-29 01:40
The USD’s attempt to correct higher fails at its first hurdle, as the market strengthens its view of the USD now trading lower.
- The USD’s attempt to correct higher fails at its first hurdle, as the market strengthens its view of the USD now trading lower.
- Price action was interesting and a decent late bounce in stocks could not really help the USD slide. USD lower in all outcomes ?
- “JPMorgan, BNP Parisbas and Danske Bank forecast the euro will be 1.20 or even more by year-end, a sharp departure from calls for parity from some analysts just 3 months ago.”(per BBG)
- The Bloomberg Dollar Spot Index’s Fear-Greed gauge, a measure that compares buying to selling strength, shows sentiment is near the most bearish since November 2022.
- The PBOC’s job has been made easier by the USD sell-off, the real effective Yuan against its trading partners is already very weak.
- Resistance in the BBDXY is at 1230, the market could not break above here and will now set its sights on the lows last week towards 1210.
- Data : US GDP, ISM Manufacturing, NFM payrolls the main events this week.
Fig 1: BBDXY Fear-Greed Index
Source: MNI - Market News/Bloomberg
ASIA STOCKS: Strong Inflows for Taiwan and India
Apr-29 01:33
The ongoing theme of outflows has showed signs of abating with Taiwan and India enjoying yet another day of strong inflows.
- South Korea: Recorded outflows of -$100m as of yesterday, bringing the 5-day total to +$92m. 2025 to date flows are -$12,672m. The 5-day average is +$18m, the 20-day average is -$368m and the 100-day average of -$148m.
- Taiwan: Had inflows of +$211m as of yesterday, with total inflows of +$1,417m over the past 5 days. YTD flows are negative at -$18,621. The 5-day average is +$283m, the 20-day average of -$111m and the 100-day average of -$208m.
- India: Had inflows of +$589m as of the 25th, with total inflows of +$2,124m over the past 5 days. YTD flows are negative -$12,857m. The 5-day average is +$425m, the 20-day average of +$128m and the 100-day average of -$123m.
- Indonesia: Had outflows of -$11m as of Friday, with total outflows of -$38m over the prior five days. YTD flows are negative -$3,073m. The 5-day average is -$8m, the 20-day average -$61m and the 100-day average -$39m
- Thailand: Recorded outflows of -$32m as of yesterday, outflows totaling -$232m over the past 5 days. YTD flows are negative at -$1,722m. The 5-day average is -$46m, the 20-day average of -$31m the 100-day average of -$21m.
- Malaysia: Recorded inflows of +$31m as of yesterday, totaling +$130m over the past 5 days. YTD flows are negative at -$2,746m. The 5-day average is +$26m, the 20-day average of -$30m and the 100-day average of -$37m.
- Philippines: Saw inflows of +$4m as of yesterday, with net inflows of +$2m over the past 5 days. YTD flows are negative at -$286m. The 5-day average is $0m, the 20-day average of -$5m the 100-day average of -$4m.
