Collinson FX: July 1: US Equities markets hit record highs
by Collinson FX 1 Jul 2025 09:59 NZST
1 July 2025
NZ Nationals - RS Feva - Murrays Bay - May 11, 2025 © Justin Mitchell
www.justinmitchell.co.nz - Instagram: @jl_mitchell_
US equity markets are setting all-time record highs, boosted by market sentiment, as war threats subside and global trade prospects improve.
The US deadline for trade deals remains 9th of July and major deals are expected to be announced by then.
The Canadian Government could not hit reverse gear fast enough, on their brand new digital tax, following Trump shutting down trade negotiations. China has already agreed and India is in the process. The EU is negotiating hard, while Asian Countries are also well down the path.
The surge in confidence has seen a precipitous fall in the US Dollar, not only for safety reasons, as multi-polarise is on the rise. German inflation declined to 2%, and the EUR surged to 1.1750, following the GBP consolidating 1.3700.
The fall in the reserve allowed for further gains in commodity currencies, with the AUD hitting 0.6550, while the NZD looks towards 0.6100. These two Countries have no trade deal with the US, so expect some news, or volatility will ensue.
Collinson FX: June 30: China trade deal confirmed
Markets rallied, to close out a strong week of gains, on US equity markets. The confirmation from China, that a trade agreement has been reached with the USA, boosting market confidence.
Late in the US trading day, it was announced that trade negotiations with Canada, were completely halted. This was triggered by Canada imposing a new ‘Digital Services Tax’ on US tech firms.
The Canadian Government will learn a harsh lesson, and back track very quickly, as they are almost totally dependent on US trade.
This coming week is a shortened trading week on US markets, as they close for US Independence Day Friday.
The US Dollar remains soft, with the EUR hitting 1.1700, while the GBP rallied to 1.3700.
The deadline for global trade agreements is July 9th, which is fast approaching, so NZ and Australia will be extremely nervous. The political leaders from both Countries have been critical of US policy and may experience ‘FAFO’.
Trade dependent nations cannot afford poor relations with the largest economy in the world. This is one reason that commodity currencies have not rallied strongly, in the face of an extremely weak reserve currency.
The AUD closed out the week trading above 0.6500, while the NZD consolidates above 0.6000, although the next two weeks are critical.
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