02/04/2025 Daily Reports
Trump’s Tariff Plan to Be Announced
- U.S. President Donald Trump will unveil his major trade move today at 2000 GMT from the White House Rose Garden.
- Trump has declared April 2 as “Liberation Day”, with immediate reciprocal tariffs on countries that impose duties on U.S. goods.
- Investors are eagerly awaiting details on the new tariffs, with reports suggesting a 20% levy on nearly all imported goods.
Dollar’s Volatility Continues
- The U.S. Dollar Index inched up to 104.25 but suffered a 3.1% drop in March, its worst monthly performance since November 2022.
Recession and Stagflation Fears Intensify
- Weak U.S. economic data and mounting tariff uncertainty fuel concerns of an economic slowdown paired with rising inflation.
Canada and Mexico Signal Countermeasures
- Canadian Prime Minister Mark Carney and Mexican President Claudia Sheinbaum discussed how to combat the U.S.’s latest trade moves.
What’s Next?
- The introduction of broad tariffs could have significant implications for global trade and the U.S. economy. While protectionist measures may support domestic industries in the short term, they also risk escalating trade tensions and increasing costs for consumers.
The coming weeks will reveal whether these tariffs strengthen the U.S. economy or lead to unintended economic disruptions. Markets are likely to experience heightened volatility as investors react to the unfolding developments.
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Markets on Edge Ahead of Trump’s Key Tariff Announcement
Global investors are bracing for clarity on President Donald Trump’s long-awaited tariff plans, set to be unveiled on Wednesday. For weeks, Trump has marked April 2 as “Liberation Day,” signaling the imposition of new trade barriers, but details on the scope and scale remain unclear, leaving markets unsettled.
The lack of specifics has fueled market anxiety, with investors unsure whether the tariffs will be broad-based or targeted. The White House confirmed reciprocal tariffs will take effect immediately upon announcement, alongside a 25% tariff on auto imports starting April 3. This uncertainty has heightened volatility, pushing the S&P 500 into correction territory and lifting the VIX, Wall Street’s fear gauge, to its highest level in weeks.
The tariff decision carries significant implications for global growth, corporate earnings, inflation, and future Federal Reserve policy. With recent data showing weaker U.S. manufacturing and softer consumer spending, investors worry that unclear or aggressive tariffs could deepen economic risks. Markets now await whether Wednesday’s announcement will bring clarity — or further questions.
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- China has ordered its top economic agencies to halt approvals for new outbound investments into the US, in a strategic move that may give Beijing leverage ahead of President Donald Trump’s upcoming tariff announcement. The temporary freeze, directed by the National Development and Reform Commission (NDRC), applies to corporate investments and adds fresh uncertainty for Chinese firms seeking to navigate trade barriers by shifting production abroad.
- The decision comes as Trump is set to unveil “reciprocal tariffs” on Wednesday, possibly targeting China and other key trade partners with levies as high as 20%. The White House is still finalizing details of the tariff plan, fueling speculation and market jitters.
- While current Chinese investments and US Treasury holdings remain unaffected, the news pushed US equity futures and European stocks lower. The move underscores intensifying trade and geopolitical frictions, especially after a $19 billion port sale by CK Hutchison Holdings to BlackRock drew backlash from Beijing.
- The developments mark a turning point in US-China economic relations, with both sides using strategic investment restrictions and tariffs as negotiating tools. Investors remain on edge as the global trade landscape faces another potentially disruptive shift.
