Trump Interrupts American and British Holidays with a Social Media Blitz – Currency Thoughts
Trump Interrupts American and British Holidays with a Social Media Blitz
May 26, 2025
(190) Monday ought to have been a quiet session in world financial markets given the holiday observances of Memorial Day in the United States and the late spring bank holiday in the United Kingdom, plus a scarcity of items on the global data release menu.
Several provocative postings by President Trump on Truth Social made sure that wouldn’t be the case.
President Zelensky is doing his Country no favors by talking the way he does. Everything out of his mouth causes problems, I don’t like it, and it better stop.
I’m not happy with what Putin is doing. He’s killing a lot of people, and I don’t know what the hell happened to Putin. He has gone absolutely CRAZY! He is needlessly killing a lot of people, and I’m not just talking about soldiers. Missiles and drones are being shot into Cities in Ukraine, for no reason whatsoever.
I received a call today from Ursula von der Leyen, President of the European Commission, requesting an extension on the June 1st deadline on the 50% Tariff with respect to Trade and the European Union. I agreed to the extension — July 9, 2025 — It was my privilege to do so.
The delayed enormous tariff hike against the EU, which kicks that can 39 days down the road, reverses a threat made just two days earlier and in effect prevents a 40 percentage point tariff increase that would have occurred this coming Sunday. Regarding Russia, Trump also made a tariff reversal. Having previously ruled out further economic sanctions against Russia in the absence of a ceasefire of hostilities in Ukraine, the U.S. President said he absolutely would now consider doing that as a response. Moscow’s immediate reaction to Trump’s posting was to characterize it as an “emotional response.”
Digesting these developments, investors around the world overnight
- Depressed the dollar, whose weighted DXY index slid as low as 98.68, a new five-week trough. The U.S. currency’s latest declines included a 5-week low of $1.1420 against the euro and a 43-month low against sterling of $1.3594. The South Korean won touched a 7-month high of 1360 per dollar.
- European stock markets got whipsawed. In contrast to Friday’s steep declines, share prices have rebounded this morning by 1.7% in Germany, 1.2% in France and Italy, 1.1% in Switzerland, and 0.9% in Spain.
- Gold (-1.0%) and Bitcoin (+0.7%) have moved in predictably opposite directions.
- Ten-year sovereign debt yields have ticked up two basis points in Germany and Spain and a single basis point in France, Italy, and Japan.
- West Texas Intermediate crude oil softened 0.2% to $61.48 per barrel.
Producer price reports for April released in Spain, Sweden and Finland today traced similar patterns. Swedish PPI deflation deepened to a 16-month low of -2.4%, representing a 5.8-percentage point swing from positive producer price inflation of 3.4% as recently as February. The 12-month rates of change in Spanish and Finnish producer price likewise fell to 5-month lows of +1.9% and -1.1% last month. Month-on-month changes in all three economies were negative in both March and April, largely reflecting their energy component.
Investors this year have extended their wariness against the Chinese economy. Following calendar year declines in Chinese foreign direct investment of 8.0% in 2023 and 27.1% in 2024, such posted a 10.9% average year-on-year decline in the first four months of the current year.
Japan’s March leading and coincident indices of economic indicators were both revised slightly higher but nonetheless still represented 3- and 4-month lows, respectively.
Czech business and consumer sentiment improved in May to their best levels in 35 and six months, respectively. After slipping in three straight months to a 25-month low in April, Irish consumer sentiment rebounded 2.1 index points to a 2-month high in May.
Copyright 2025, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Trump delays 50% tariff against EU, Trump unhappy with Putin and Zelensky
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