Morning Bid: Trump's Fed backflip sets off relief rally

A look at the day ahead in European and global markets from Kevin Buckland

Listening to President Trump on Tuesday, it's as if all the vitriol towards Fed boss Jay Powell - the threats, the name calling - was some crazy misunderstanding. Trump now says he had "no intention of firing him" and was just gently angling for a rate cut or two.

In the same news conference, Trump said the exorbitant levies on Chinese goods following a rapid tit-for-tat trade war escalation - so high that the actual numbers became irrelevant - will soon be "substantially" lower.

Market reaction was immediate, as investors rushed back into the dollar after days of heavy selling - dubbed the "sell America" trade - that pushed the currency to multi-year lows against the likes of the euro and Swiss franc.

There was a scramble back into Wall Street stocks as well, which lifted share markets around Asia and looks set to buoy Europe, too.

With just a week to go until Trump completes the symbolic 100th day of his second term in the Oval Office, you might think market players had got used to his relentless string of sudden pivots and abrupt about-faces.

Instead, there's a lot of head-scratching and multiple pet theories about just what is happening behind closed doors.

Many analysts conjecture that, with the dolla...
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