ForexLive Asia-Pacific FX news wrap: Trump reciprocal tariff announcement due later

• BYD cuts prices in Japan - seeks to gain market share
• Goldman Sachs sees yen longs as the best hedge against US recession and tariff risks
• Federal Board Governor Kugler speaks on inflation and monetary policy making on Wednesday
• Trump’s so-called "Liberation Day" unlikely to resolve U.S. tariff uncertainty
• European Central Bank big wheels Lagarde, Lane and Schnabel are all speakin on wednesday
• Canada to avoid countertariffs that risk Canadian jobs, price hikes – Globe and Mail
• BoJ's Ueda says US tariffs likely to push up US inflation in near term
• ICYMI - China's new guidelines to boost financial support for tech innovation: key points
• PBOC sets USD/ CNY mid-point today at 7.1793 (vs. estimate at 7.2663)
• Bank of Japan Governor Ueda will be speaking soon, from 0110 GMT/ 2110 US Eastern time
• Australian February building permits -0.3% m/m (expected -1.5%)
• ING says Japan rate rise expectations too low, sees BoJ neutral rate near 2%
• Wells Fargo warns April 2 risks ‘not small’ , but express longer term optimism
• RBA's Kent says will raise new OMO repo rate by 5bp to 10bp above cash rate target
• South Korean March CPI +2.1% y/y (+2% expected)
• Fed's Goolsbee says strength of economy still there, but confidence almost cratering
• Bessent says Trump will announce a maximum for tariffs, countries can then bring them down
• New Zealand data - February Building permits +0.7% m/m (prior +2.6%)
• Markets still guessing as tariff risks escalate, warns Deutsche Bank
• US Treasury has floated a new tariff option for Trump to consider!
• Oil - private survey of inventory shows a headline large crude oil build vs. draw expected
• Forexlive Americas FX news wrap: Another round of tariff fears fade
• Trade ideas thread - Wednesday, 2 April, insightful charts, technical analysis, ideas

Late in the US afternoon were a couple of fresh tariff news items.

1. The Wall Street Journal reported that the US Treasury and Commerce depts. had prepared another option for Trump to consider:

• across the board tariff increase
• on a subset of nations
• would not be as high as 20%

2. US Treasury Secretary Bessent was reported as saying that the tariffs to be announced today are a ‘cap’:

• the amounts to be announced Wednesday are the highest the tariffs will go
• countries could then take steps to bring the tariffs down

‘Risk’ FX caught a small bid on the Bessent story, with EUR, AUD, NZD all a little higher before subsiding again. As I update EUR/USD, GBP/USD, USD/CAD are all little net changed on the session. AUD and NZD have outperformed, though.

Reserve Bank of Australia Assistant Governor (Financial Markets) Christopher Kent spoke, flagging a small rise in the rate on all new RBA OMO repos by 5 basis points to 10 basis points over the cash rate target (more detail in the bullets above). Kent added that the changes have no implications for the stance of monetary policy. I know correlation is not causation and all that, but AUD has risen on the session.

While speaking about central banks, Bank of Japan Governor Ueda appeared in the Diet (Japanese parliament) today. He addressed the likely impacts of US tariff policy, saying, amongst other points, that depending on the size of US tariff hikes, they could have a big impact on trade activity in each country. The yen has done little on the day. USD/JPY ticked a little higher, topping out just over 149.90.

Gold traded solidly higher, hitting highs circa US$3135.