Currency news / April 2, 2025

Tariff day

3 min read Thanim Islam

Thanim IslamApril 2, 2025

Market snapshot:

Trading choppy ahead of tariff announcements

Yesterday's currency recap

Earlier USD gains were erased after ISM manufacturing contracted more than expected in March.

Eurozone inflation eased further in March, as was widely expected - hence the limited impact on the EUR.

GBP was weaker across the board after Chancellor Rachel Reeves told the Cabinet that US tariffs will impact the UK and the country will have to take a pragmatic approach.

In anticipation of today's tariff announcements, due at 4pm EST, FX trade had a fairly choppy day.

Today's GBP rates

Currency pair	Daily move*	Indicative rate**
GBPAUD	-0.47%	2.0582
GBPCAD	-0.47%	1.8497
GBPCHF	-0.15%	1.1406
GBPDKK	0.15%	8.924
GBPEUR	0.15%	1.196
GBPJPY	-0.40%	192.919
GBPNOK	-0.52%	13.506
GBPNZD	-0.40%	2.2662
GBPSEK	-0.42%	12.9157
GBPUSD	0.03%	1.2921

*Daily move - against G10 rates at 7:30am, 02.04.25
** Indicative rates - interbank rates at 7:30am, 02.04.25

Key data points

Currency	Event	Period	Consensus	Previous
USD	ADP Payrolls	Mar	120,000	77,000

What we think

All eyes on this evening's announcement from Washington (9pm UK time). A CNBC report yesterday suggested that blanket 20% tariffs are less likely than country-by-country rates or a tiered system. For all the noise from Trump about brandishing tariffs and potentially starting a trade war, it seems his real aim could well be to make room for negotiations. Scott Bessent spoke last night and said tariffs will be set at the highest they can go, in order to make countries countries take steps towards bringing them down. This echoed the sentiment that all of the commotion is just a strategy to prompt future negotiations.

Before the announcement, we have the ADP payroll report but if truth be told we expect trading to stay within the range of the last few days as we wait for the announcement from Washington this evening.

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