(Correction of the Dollar index of the dollar index in paragraph 8: April 22 instead of April 2022)

By Johann M Cherian

Singapore (Reuters) -Asian stock markets remained stable on Monday and the euro straightened up after President Donald Trump (link) suddenly extended (link) over a month his threat to impose customs duties of 50 % (link) on European products, thus marking a new temporary respite in its erratic commercial policy.

Trump agreed to postpone the deadline for commercial negotiations he had set on Friday as of June 1 (Link), after the European Commission, Ursula von der Leyen, said that the European Union needed more time to “achieve a good agreement” on July 9, on July.

The feeling of the market stabilized after a sudden fall in most of the assets last month, while Trump has paused his customs prices which slow down growth and investors were impatient to conclude new trade agreements after a pact with Great Britain and a temporary agreement with China.

However, Trump’s latest political measures reminded investors how quickly the circumstances could change quickly, and the analysts (link) onsouligné that investors transfered their money from the United States to Europe and Asia, as they evaluate the possibility of a recession in the United States and a global slowdown.

Last Friday’s comments recalled the unpredictable and apparently inconsistent policies and decisions of Trump and his administration, said Commerzbank in a note.

On Monday, the widest MSCI index of the shares of Asia-Pacific excluding Japona slipped by 0.07%, while the term contracts in Europe and Germany indicated a higher opening of more than 1.5%.

Among the currencies, the euro appreciated 0.35% to $ 1,1404 – its highest level since April 29 – while the currency sensitive to the risk of Australia and New Zealand were strengthened by 0.37% and 0.45% respectively. [FRX/]

The dollar index, which measures the greenback compared to a currency basket, has touched its lowest level since April 22, the analysts and the speech “sell America” ​​is always dominant.

“This is always a great story of ‘dollar sale’,” said Christopher Wong, a currency strategist at OCBC.

“The unpredictability of the policy surrounding Trump’s customs tariffs and, of course, the erosion of American exceptionalism, could still undermine the feeling and confidence in the medium term.”

Exchange volumes on Monday should be low since markets in the United States and Great Britain are closed due to public holidays.

In Japan, the Nikkei increased, Nippon Steel winning 2.3% after Trump expressed his support (link) to the company’s $ 14.9 billion for US Steel on Friday.

Japanese bonds in the very long term will be at the center of attention, with data on inflation expected later in the week, while investors are trying to assess the prospects of the monetary policy of the Banque of Japan. The yields of these obligations reached record levels (link) last week.

The swelling of debt levels in developed economies was also presented in light following the lowering of the United States credit note by Moody’s and low debt auctions in the United States and Japan last week.

The Chinese star values ​​index fell 0.7% on Monday, while the Hong Kong Hang Seng index dropped by 1%. Apple suppliers side in China took a hit after Trump threatened to take 25 % from all imported iPhones bought by US consumers on Friday.

The signs indicating that the global economy is better than expected to recession fears were a relief for the markets as a whole. Inflation reports from Japan and Germany are expected later in the week, as well as data on household consumption expenditure, which is the priority of the Fed.

On the raw material front, crude prices have increased, while gold has moved away from its two weeks higher. [GOL/] [O/R]

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