Amid rising fears of a global tariff war and concerns over a slowing US economy, financial markets have experienced heightened volatility. These developments have prompted risk-off flows, leading to significant movements in currency and cryptocurrency markets. On Monday, the US Dollar witnessed a fresh uptick, influenced by these risk-off dynamics. Meanwhile, Japanese Yen buyers remained steadfast, bolstered by the anticipated policy divergence between the Federal Reserve and the Bank of Japan.
In forex markets, USD/JPY managed to recover losses and traded above 147.50 early Monday. This movement reflects the market's response to the evolving economic landscape and the ongoing tug-of-war between major currencies. The fluctuations in currency values underscore investor sentiment and expectations for future policy adjustments.
Cryptocurrency markets did not remain untouched by the recent volatility. Bitcoin hovered around $82,000 on Monday, following a significant drop of nearly 15% last week. Similarly, Ethereum and Ripple mirrored Bitcoin's decline, crashing by approximately 20% and 28%, respectively. Momentum indicators for both Ethereum and Ripple suggested potential further corrections, adding another layer of uncertainty to the digital asset market.
Despite these turbulent conditions, certain sectors showed resilience. Gold prices extended their range-play, trading above $2,900 as a new week commenced. Gold's stability hints at its continued appeal as a safe-haven asset amid market fluctuations and geopolitical uncertainties.
Consumer price inflation data released in 2025 offered mixed signals. While overall inflation remained strong, price growth exhibited signs of cooling in February. The headline Consumer Price Index (CPI) rose by 0.25%, with the core index advancing by 0.27% during the same period. Analysts noted that the core index likely reflected a pullback in several categories that had surged in January.
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