Riskier assets and gold ended last week with huge gains due to the weak US dollar’s performance. Let’s discuss what will drive the markets today.
America keeps considering quotas for steel and aluminum
American officials insist on quotas as well as other restrictions on imports of steel and aluminum, a senior sales representative told today after the White House announced an extension of the monthly benefits for Canada, Mexico and also the European Union.
As the White House representatives pointed out they will have quotas and also other restrictions so that they could protect their industries in the interests of national security.
In March the Trump administration told that it would impose a 25% duty on steel imports as well as 10% on aluminum in an attempt to stop imports from China, which, according to the US President, lowered prices and also pulled American companies out of business.
At the same time the US President dared to grant temporary exceptions to American allies, such as Canada, Mexico and the European Union, which expired on Tuesday morning. The administration told Monday night that these benefits will continue for a month. However, adding full duties appears to be one option.
Last night's decision turns to be a step forward anyway. That’s what Canadian Foreign Minister Christiane Freeland revealed to reporters on Tuesday. He added that Canada will keep working for full as well as permanent exemption from duties.
By the way, until Tuesday, South Korea turned out to be the only country with full exemption after it agreed to quotas. On Monday, the US government told that it managed to reach an agreement on constant duties for Brazil, Argentina and Australia.
In addition to this, the American authorities tried to link the exemption from duties for imports of steel and aluminum from the European Union in the direction of cutting duties for car imports. However, this step was denied by the European Union, which pointed out that it should get a permanent exemption from duties before conducting a broader discussion on trade.
The US president is back to White House after three days spent in the hospital. Riskier assets rose, while safe havens dipped.
The market sentiment has switched to risk-on, driving upwards stocks and riskier currencies and weighing on the US dollar.
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