If Art of the Deal were a movie, we would all be extras in it — or so it felt this week. Global markets were thrown into chaos (and then euphoria) by President Trump’s tariff playbook. China was hit with a 34% tariff, responded in kind, and after some back and forth, saw its rate escalate to 145%. For most other countries, the twist came: a 90-day pause for over 75 nations, resetting most tariffs to a base 10%. The market reaction? Equities up, dollar down. The S&P 500 posted its best single-day gain since 2008, while the DXY broke the 100 mark at the time of writing.
Macro: Equities Rebound, Dollar Tumbling
Equity markets experienced a historic surge mid-week following President Trump’s announcement of a 90-day pause on new tariffs for most countries except China. The S&P 500 soared 9.5% on Wednesday, while the Nasdaq jumped 12.2%, achieving its largest gain since 2001. However, the surge was quickly followed by a pullback.
In the bond market, 10-year US Treasury yields exhibited significant volatility. After an initial flight to safety earlier in the week, yields climbed back to around 4.45% following the tariff pause announcement.
The USD faced notable pressure amid these developments. Since last Friday, the DXY index dropped -2.3%, reaching its lowest level since October, reflecting concerns over the potential impact of trade policies on the U.S. economy. EUR/USD briefly pushed above 1.1350, while USD/CHF dropped below 0.82 today — a level not seen since 2011. The swift move in FX underscores how quickly the market is repricing US macro credibility.
This represents a rare scenario where capital exited both risk and non-risk assets, leaving gold and the Swiss franc as the sole gainers.
Crypto: Modest Tailwind
Despite the surge in equities, bitcoin flows have remained muted. Part of the hesitation likely stems from uncertainty around the macro narrative: while equities celebrated a 90-day tariff pause, crypto markets are still digesting what a prolonged trade war could mean for liquidity and risk appetite. In concrete terms, BTC reclaimed the USD 80,000 level midweek but struggled to hold momentum, closing Thursday just below USD 79,000. ETH followed suit, drifting around USD 1,500 with no real breakout in sight.
Nevertheless, one thing remains consistent: BTC continues to outperform in the grand scheme of things. ETH/BTC broke below the 0.02 level this week — a five-year low — and BTC dominance keeps climbing, now sitting at 62.4%.
Looking Ahead: Earnings and Trade in Focus
Next week kicks off earnings season, with major US companies set to report and shed light on corporate health after a volatile stretch. Markets will also be watching for any developments on the trade front, especially around US–EU–China dynamics following Trump’s tariff pause. Economic data will be lighter, but Tuesday’s import/export price indexes could offer clues on inflation trends. With Easter approaching, liquidity may start to thin — but volatility could still spike if geopolitics or earnings surprise.
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