Portfolio Update – April 2025

General news

• On 01/04/2025, The Reserve Bank of Australia (RBA) maintained its benchmark interest rate at 4.1% on Tuesday, despite inflation easing faster than expected, with February’s reading at 2.4%. While the central bank acknowledged reduced inflationary risks, it warned that premature rate cuts could hinder progress toward sustaining inflation within its 2%-3% target range. Australia’s economy showed resilience, with GDP growing 1.3% year-on-year in Q4 2024, its fastest pace in a year. RBA Governor Michelle Bullock emphasized the need for sustained inflation control, expressing skepticism over market expectations of multiple rate cuts beyond February’s. Meanwhile, Australia heads into a national election on May 3, with the government in caretaker mode.
• Germany’s inflation slowed to 2.3% in March, below expectations and February’s revised 2.6%, with core inflation easing to 2.5%. Services inflation, previously persistent, also declined to 3.4%. The data comes amid uncertainty as U.S. President Donald Trump’s tariffs, including a 25% levy on imported cars, threaten Germany’s trade-dependent economy. Analysts suggest the trade conflict could initially drive inflation up but may later have a disinflationary effect if economic growth slows. Meanwhile, Germany’s political parties are negotiating a new coalition government following the February election, recently approving a fiscal package allowing for higher defense spending and infrastructure investments. With euro zone inflation figures expected soon, economists anticipate a slight decline, potentially influencing upcoming European Central Bank policy decisions.
• The latest CNBC Rapid Update projects a sluggish 0.3% U.S. GDP growth for Q1, down from 2.3% in Q4 2024, marking the weakest expansion since 2022. Policy uncertainty and sweeping tariffs from the Trump administration are fueling concerns of stagflation, with core PCE inflation expected to hover around 2.9% for most of the year. Consumer spending remains weak, growing just 0.1% in February after a January decline, while a surge in imports has further weighed on GDP. Although most economists predict a gradual rebound, with growth rising to 2% by Q4, risks of a recession remain, particularly if tariffs persist. Some analysts warn that without policy adjustments, the U.S. could face consecutive quarters of economic contraction.
• On 02/04/2025, U.S. President Donald Trump’s new tariffs will take effect immediately after their unveiling on Wednesday, White House press secretary Karoline Leavitt confirmed. Dubbed “liberation day,” Trump’s reciprocal tariffs will target countries imposing duties on U.S. goods, though details remain unclear. The announcement comes amid escalating trade tensions, with prior tariffs already imposed on China, Canada, Mexico, and the auto industry. Trump will outline the policy at a Rose Garden event Wednesday at 4 p.m. ET.
• On 03/04/2025, Trump’s sweeping reciprocal tariffs, affecting over 180 countries and territories, sent markets tumbling and heightened recession fears. Analysts warn of rising inflation, disrupted supply chains, and a potential global economic slowdown. Experts predict consumer price shocks, delayed business investments, and retaliatory tariffs from key trade partners. Some, like David Roche, view the move as a long-term shift toward economic nationalism. Others, including Shane Oliver, estimate U.S. recession odds at 40%, with global growth possibly slowing to 2%. The Fed may be forced to cut rates sooner amid stagflation risks.
• U.S. stock futures plunged after Trump’s sweeping tariffs, with the Dow down 828 points (1.95%), S&P 500 futures dropping 2.68%, and Nasdaq-100 losing 3.19%. Multinational and tech stocks, including Apple (-7%), Nvidia (-5%), and Tesla (-7%), took major hits. Retailers reliant on imports also fell sharply. The White House’s 10% baseline tariff, with higher rates for certain nations (e.g., China at 54%), spooked traders expecting a universal cap. Analysts fear the complex tariff structure will worsen market volatility, inflation, and recession risks.
• On 04/04/2025, U.S. stock futures declined Friday following the biggest market drop in five years, triggered by President Trump’s announcement of sweeping tariffs, including a baseline 10% rate on all imports starting April 5. The Dow, S&P 500, and Nasdaq all saw sharp losses, with tech stocks leading the downturn and the Russell 2000 entering a bear market. Investors reacted with a broad sell-off amid fears of a global trade war, uncertainty over potential retaliatory measures, and skepticism about trade negotiations. Attention now turns to the upcoming U.S. jobs report, which may influence market sentiment moving forward.
• European stock markets continued their slide Friday as investors reacted to the sweeping U.S. tariffs announced by President Trump, which have sparked fears of a global trade war. The Stoxx 600 fell at the open, led by sharp losses in banking and retail, with shipping giants like Maersk and Hapag-Lloyd down over 9%. Export-heavy Asian economies and sectors reliant on global trade were hit particularly hard, especially with Trump’s new 25% auto tariffs. The euro surged to a six-month high, while EU leaders warned of retaliation, with France and Germany calling for a united response. Goldman Sachs downgraded growth forecasts for several European economies, including the U.K., citing the unexpected severity of the tariffs.
• A massive wave of federal government job cuts led to one of the highest monthly layoff totals on record in March, second only to the early months of the 2020 COVID-19 shutdown, according to a report from Challenger, Gray & Christmas. The Department of Government Efficiency (DOGE), led by Elon Musk, was behind the bulk of the cuts, with 216,215 federal positions eliminated out of a total 275,240 layoffs for the month. Over the past two months, DOGE has cut 280,253 jobs across 27 agencies, including expected reductions of 80,000 at Veterans Affairs and 18,000 at the IRS. This marks a 672% increase in federal layoffs compared to the same period in 2024. While national unemployment claims and payroll growth remain relatively stable, Washington, D.C. has been particularly impacted, reporting 278,711 layoffs so far this year.
• On 05/04/2025, U.S. job growth outpaced expectations in March with nonfarm payrolls rising by 228,000—well above the forecasted 140,000—according to the Labor Department, though the unemployment rate ticked up to 4.2% as labor force participation increased. While the strong jobs report temporarily eased concerns about a weakening labor market, it came amid heightened uncertainty following President Trump’s sweeping 10% tariffs on all trading partners and additional reciprocal duties, which have already triggered global retaliation. Despite solid hiring numbers, markets remained focused on the potential economic fallout of the trade tensions, with the Dow still down over 900 points and investors seeking refuge in bonds. Though hourly earnings rose 0.3% for the month, annual wage growth slowed to 3.8%, its lowest level since July 2024, and earlier job gains for January and February were revised lower.
• In response to the latest round of steep U.S. tariffs, China is expected to focus less on retaliation and more on boosting domestic stimulus and expanding trade ties with other nations, analysts say. After President Trump announced a 34% tariff on Chinese goods—raising the total to 54%—China’s Ministry of Commerce called for the U.S. to cancel the duties while leaving the door open for negotiation. Experts believe Beijing will prioritize internal economic strengthening by increasing domestic consumption, offering fiscal support, and diversifying export markets rather than matching tariffs. Already dealing with a slowing export sector, China has implemented stimulus measures, reversed regulatory crackdowns, and reinforced support for its private sector. Analysts also anticipate Beijing will maintain a strong yuan and impose export controls on strategic resources. Meanwhile, China is deepening ties with ASEAN nations through RCEP, positioning itself as a more resilient player amid shifting global trade dynamics.
• European markets ended the week in a tailspin as fears of a full-blown global trade war rattled investors. The Stoxx 600 closed down 5% on Friday, capping an 8.3% weekly drop — its worst performance this year. Banking stocks plunged 8.5%, with analysts warning the sector is especially vulnerable to slowing global growth or recession. Meanwhile, China hit back at the U.S. with 34% tariffs on American imports, escalating tensions after President Trump’s sweeping tariff move affected more than 180 countries. Retail and shipping stocks were hammered, with Maersk and Hapag-Lloyd both down over 9%, while luxury goods and auto manufacturers suffered steep losses. The euro hit a six-month high against the dollar before flattening out, and EU leaders signaled readiness to retaliate if talks with Washington fail. Economists are revising growth forecasts across Europe, with Goldman Sachs trimming its outlook for the U.K. and several other nations as the world braces for the economic ripple effects of the mounting tariff war.
• On 07/04/2025, President Trump denied deliberately causing the ongoing stock market sell-off but defended his tariff strategy, saying economic “medicine” is sometimes necessary to fix deeper issues like the U.S.–China trade deficit. Speaking aboard Air Force One, Trump emphasized his commitment to addressing the imbalance, stating he won’t strike a deal with China unless it reduces its surplus. Despite U.S. stock futures plunging and global markets reeling, Trump and his administration, including Commerce Secretary Howard Lutnick and economic advisor Kevin Hassett, maintained their support for the tariff rollout. Trump also acknowledged conversations with European and Asian leaders over the weekend and shared a video on Truth Social suggesting the market drop was part of a broader economic plan — a notion he neither fully confirmed nor denied.
• Asia-Pacific markets plunged on Monday as escalating global trade tensions, driven by President Trump’s sweeping tariffs, triggered a broad risk-off sentiment. Hong Kong’s Hang Seng Index led losses with an 11.72% drop, while China’s CSI 300 fell 6.39%, reeling from Beijing’s retaliatory measures. Japan’s Nikkei 225 slid nearly 7% to an 18-month low, with trading halted earlier due to circuit breakers. South Korea’s Kospi fell over 5%, Australia’s ASX 200 dropped 4.3%, and India’s Nifty 50 declined 4.05%. Investors grew increasingly pessimistic as hopes for successful negotiations faded and U.S. futures continued to slide. Meanwhile, oil prices dropped below $60, and U.S. stocks saw their steepest declines since 2020, with the Dow falling over 2,200 points and the Nasdaq officially entering bear market territory. Despite the turmoil, Trump’s economic team doubled down on tariffs, brushing aside fears of inflation and recession.
• U.S. stock futures plunged early Monday as markets braced for another brutal session following a historic two-day sell-off triggered by President Trump’s sweeping tariff hikes on major trading partners. Dow futures dropped over 1,000 points, while S&P 500 and Nasdaq futures fell 3.34% and 4.26%, respectively. This extended last week’s market meltdown, which saw the Dow lose over 2,200 points on Friday and the Nasdaq enter bear market territory, down 22% from its record high. Hopes for a policy reversal or tariff delay were dashed as the White House doubled down, with Trump defending the move as necessary “medicine” to fix the trade deficit with China, and key officials confirming tariffs will remain in place. Investor sentiment further deteriorated after China retaliated with a 34% blanket tariff on U.S. goods, intensifying fears of a full-blown trade war.
• On 08/04/2025, U.S. oil prices dropped about 2% on Monday, extending last week’s significant losses, as concerns mounted that President Trump’s global tariffs could push the U.S. and potentially the global economy into recession. U.S. crude fell to $60.70 per barrel, while Brent dropped to $64.21. This follows a more than 10% drop in oil prices last week. The decision by key OPEC+ producers to increase production has further pressured prices, with Saudi Aramco cutting the price of its flagship crude. Despite Trump touting lower oil prices and tariffs as beneficial, fears are growing that the tariffs could lead to higher business costs, dampening economic activity and oil demand. JPMorgan raised its recession probability to 60%, while Bank of America warned that the trade war could halve oil demand growth, resulting in an oversupply. Goldman Sachs also lowered its oil price forecast, predicting further declines. With U.S. crude already below break-even levels for some shale producers, further price drops could force cuts in production.
• Asia-Pacific markets opened higher, recovering from the previous session’s losses driven by U.S. President Donald Trump’s tariff policy and threats of further levies on China. Australia’s S&P/ASX 200 rose by 0.18%, while Japan’s Nikkei 225 surged 5.34% and the Topix climbed 5.53%. South Korea’s Kospi gained 2.26%, and the Kosdaq rose 2.35%. However, Hong Kong’s Hang Seng index futures were weaker, at 19,653, compared to the previous close of 19,828.3. The market’s focus shifted to Chinese stocks following Trump’s threat to impose additional 50% tariffs on China unless Beijing lifts its duties on U.S. imports. Hong Kong’s market led regional losses, plummeting over 13%, marking its steepest one-day decline since 1997. Trump continued with his aggressive tariff strategy over the weekend, with a 10% unilateral tariff taking effect on Saturday. Wall Street had hoped for progress in U.S. negotiations with other countries, as reciprocal tariffs are set to begin on April 9. Despite the overall downturn, U.S. stock futures rose, with S&P 500 futures gaining 1%, Nasdaq-100 futures up 1.1%, and Dow Jones futures increasing by 476 points, or 1.2%. However, overnight, the Dow Jones Industrial Average dropped 0.91% to close at 37,965.60, the Nasdaq Composite inched up by 0.10%, and the S&P 500 lost 0.23%, closing at 5,062.25.
• Analysts warn that the risk of a full-blown U.S.-China trade war is growing after China’s stronger-than-expected retaliation to President Trump’s new tariffs. Beijing responded by imposing a 34% tariff on all U.S. goods, matching U.S. duties, and added export curbs on rare earth elements and restrictions on U.S. defense firms. This aggressive move signals China’s readiness for a prolonged conflict, with the possibility of further escalation leading to a decoupling of U.S.-China trade by 2025. Morgan Stanley predicts these tariffs could slow China’s economy by up to 2% this year due to weaker exports and domestic deflation.
• On 09/04/2025, Tensions between the U.S. and China are escalating rapidly as trade negotiations stall, with both sides hardening their positions. After President Trump imposed a 34% tariff hike on Chinese goods—on top of earlier levies—China responded with equivalent tariffs across the board, signaling a broader trade conflict that could expand beyond economics into geopolitics and technology. At a press briefing, China’s Foreign Ministry emphasized it would not respond to pressure, and analysts now see a rising risk of deeper decoupling. Trump has threatened further tariffs if China doesn’t yield, raising the effective U.S. tariff rate on Chinese exports to over 100%. With both sides making decisions at the highest levels of government, and few signs of behind-the-scenes progress, a resolution appears distant. However, some believe that worsening domestic economic impacts may eventually push both nations toward a deal. Meanwhile, China is expected to announce domestic stimulus soon, with markets watching closely for signs of support, particularly in tech and consumer sectors.
• U.S. President Donald Trump rejected the EU’s offer to eliminate tariffs on cars and industrial goods unless the bloc commits to purchasing $350 billion worth of American energy, calling it essential to address the massive U.S.-EU trade deficit. Speaking alongside Israeli Prime Minister Netanyahu, Trump dismissed the EU’s “zero-for-zero” proposal from Commission President Ursula von der Leyen and reiterated his stance that tariffs—or the threat of them—are a critical leverage point. He argued that non-tariff barriers like strict EU standards also hurt U.S. exports and insisted that future trade deals must put “America first.” Trump’s recent tariffs have shaken global markets, with European stocks suffering steep losses. While he left the door open for negotiation, he emphasized any deal must heavily benefit the U.S., pointing to energy purchases as a potential path forward.
• On 10/04/2025, China has escalated its trade dispute with the U.S. by raising tariffs on American imports to 84%, up from 34%, effective April 10, in direct response to President Trump’s latest increase to a staggering 104% on Chinese goods. This intensifying tit-for-tat tariff battle between the world’s two largest economies threatens to severely disrupt global trade. The U.S., which exported $143.5 billion in goods to China last year while importing $438.9 billion, has now pushed tariffs to 125% after China’s retaliatory move. While some countries like Japan have signaled openness to negotiations, China is taking a hard-line approach. U.S. Treasury Secretary Scott Bessent criticized Beijing, calling its economy the most imbalanced in modern history and warning that China’s stance would backfire. The escalating trade war has rattled global markets, triggering a sharp sell-off and pushing both the S&P 500 and South Korea’s Kospi Index into bear market territory, with Asian markets like Shanghai and Hong Kong also posting steep declines.
•  The European Union has officially approved its first wave of retaliatory tariffs against the U.S., following President Trump’s imposition of 25% duties on steel and aluminum imports. Starting April 15, the EU will begin collecting duties on a broad set of U.S. goods, with a second round set for May 15. While the final list of targeted products hasn’t been disclosed, earlier drafts suggest items like poultry, grains, clothing, and metals will be included. The European Commission emphasized that these measures are in response to what it calls “unjustified and damaging” U.S. tariffs, which it says hurt both sides and the global economy. Although the EU reiterated its preference for a negotiated settlement, it warned it will continue escalating countermeasures if necessary. This comes as the EU faces additional 20% tariffs on nearly all its exports to the U.S., affecting an estimated €380 billion ($420 billion) worth of goods — roughly 70% of its total exports to America. Despite the hardline stance, European Commission President Ursula von der Leyen maintains that “it is not too late” for negotiations to resolve the standoff.
• President Trump announced a 90-day pause on most new tariffs, setting a flat 10% rate to allow time for trade negotiations, just hours after steeper tariffs took effect on imports from nearly 90 countries. At the same time, he raised tariffs on Chinese goods to 125%, citing China’s disrespect for global markets. The move caused U.S. stock markets to rebound sharply after days of losses. While the administration claimed the pause was always planned, critics, including Senator Schumer, called it chaotic and reactionary. Trump defended the shift as a strategic adjustment amid growing global pressure.
• On 11/04/2025, U.S. consumer price inflation cooled more than expected in March, with the CPI falling 0.1% and the annual rate easing to 2.4%, down from 2.8% in February, according to the Bureau of Labor Statistics. Core inflation, excluding food and energy, rose just 0.1% for the month, bringing the annual rate to 2.8%, its lowest since March 2021. Falling energy prices, particularly a 6.3% drop in gasoline, helped curb overall inflation, while food and shelter costs saw modest increases. The report came as President Trump prepared to implement tariffs expected to impact sectors like the auto industry.
• Global bond yields dropped on Thursday as markets stabilized following a turbulent week triggered by President Donald Trump’s aggressive tariff policies. After sharply raising tariffs on over 180 countries and escalating tensions with China, Trump unexpectedly announced a 90-day reduction to 10% tariffs on most trade partners. This “Trump put” sparked a major rally on Wall Street and eased bond market pressures. U.S. Treasury yields fell across the board, with the 10-year yield dropping nearly 10 basis points. Analysts suggest Trump was influenced by bond market volatility, which can signal rising borrowing costs and recession risks. Speculation that China may be selling U.S. assets also added to the market jitters.
• China escalated its trade war with the U.S. on Friday by raising tariffs on American goods to 125%, up from 84%, in response to President Donald Trump’s steep tariff hikes, which now total 145% on Chinese imports. Beijing declared that further U.S. tariff increases would be economically meaningless and vowed to stop responding. This sharp deterioration in relations has dimmed hopes for a trade deal, with China promising to continue countermeasures. Meanwhile, Goldman Sachs cut its China GDP forecast to 4%, citing the toll from the trade conflict and broader global slowdown.
• On 12/04/2025, Wholesale prices fell unexpectedly in March, with the producer price index dropping 0.4%, the first decline since October 2023, signaling easing inflation even as President Trump intensified tariffs on U.S. trading partners. Core PPI also dipped by 0.1%, against forecasts for a rise, largely due to an 11.1% plunge in gasoline prices. Despite the drop, annual PPI inflation remains above the Fed’s 2% target at 2.7%. The data, seen as outdated amid ongoing trade policy shifts, comes as Trump imposed a 10% levy on all imports but paused broader reciprocal tariffs for 90 days to encourage negotiations.
• On 13/04/2025, President Donald Trump has exempted smartphones, computers, and other key tech products from his sweeping 145% tariffs on Chinese goods, according to new guidance from U.S. Customs and Border Protection. The move spares companies like Apple, which relies heavily on Chinese manufacturing, from major cost increases. Additional exemptions cover semiconductors, solar cells, flash drives, and memory cards. The White House said the exemptions aim to give tech firms time to shift production to the U.S. Analysts view the decision as a major relief for the tech sector, with Wedbush’s Dan Ives calling it a “game changer” that averted potential disaster for big tech.
• On 14/04/2025, China’s Commerce Ministry has responded to President Donald Trump’s tariff exemptions by calling them a “small step” and urging the U.S. to fully repeal the 145% reciprocal tariffs on Chinese imports. In an online statement, the ministry appealed to Washington to abandon what it described as “wrongful” actions and instead pursue mutual respect and dialogue. While Beijing is still assessing the impact of the exemptions on key tech products, state media and public opinion are framing the move as a U.S. retreat, highlighting the resilience and irreplaceability of Chinese supply chains. Despite the exemptions, a 20% blanket tariff on all Chinese goods remains in effect, and there are currently no plans for direct talks between Trump and Chinese President Xi Jinping.
• On 15/04/2025, Federal Reserve Governor Christopher Waller said he believes the inflationary impact of President Trump’s tariffs will be “transitory,” reviving a controversial term from the Fed’s 2021–2022 inflation missteps. Speaking in St. Louis, Waller outlined two scenarios: large, sustained tariffs could spike inflation to 4–5% before easing with slower growth and rising unemployment, while smaller tariffs could push inflation to around 3% before falling. In either case, he expects the Fed will eventually cut interest rates, either to support growth or as a “good news” move. Waller defended reusing the term “transitory,” drawing a football analogy to the Philadelphia Eagles’ “tush push” play, arguing that past failures shouldn’t prevent similar strategies if conditions align. He also said Trump’s tariffs may either aim to remake the economy or act as leverage in trade negotiations, with the outcome affecting inflation forecasts. Waller emphasized the importance of flexibility in policymaking amid what he called one of the biggest economic shocks in decades.
• Nvidia announced it will take a $5.5 billion quarterly charge due to new U.S. export license requirements for its H20 AI chips destined for China and select countries, sending its stock down over 6% in after-hours trading. The move signals mounting pressure on Nvidia’s growth amid tightening export controls, as the H20 chip—designed to comply with earlier U.S. rules—generated up to $15 billion in 2024. Despite efforts to adapt, including shifting operations out of China, Nvidia now faces indefinite licensing restrictions under new “AI diffusion rules” and broader tariff threats under President Trump. China, once a key market, has seen declining revenue for Nvidia, with rising domestic competition from companies like Huawei and DeepSeek. The H20 chip, though based on older Hopper architecture, was a key part of Nvidia’s China strategy, which is now in jeopardy. Other chipmakers like AMD and Broadcom also saw their shares fall following the announcement, reflecting broader investor concern about the escalating regulatory risks to the AI semiconductor industry.
• The scene at the Canton Fair in Guangzhou paints a stark picture of how deeply Donald Trump’s 145% tariffs on Chinese goods are impacting small- and mid-sized manufacturers. Lionel Xu of Sorbo Technology, whose mosquito repellent kits once flew off Walmart shelves, now watches them gather dust in a warehouse. “Trump is a crazy man,” he says bluntly, voicing the frustration felt by many exporters who’ve seen their U.S. sales grind to a halt. With half of Sorbo’s business tied to the American market, the uncertainty is existential. Nearby, Amy from Guangdong Sailing Trade Company echoes the same concern—her ice cream makers are also sitting idle, production halted, and U.S. orders stalled. Despite the hardship, many still cling to cautious optimism that Trump might soften his stance. Xu, hosting Australian buyers, holds out hope that “maybe it will get better in one or two months.” But the sense of fragility in the face of escalating economic tensions is unmistakable.
• On 17/04/2025, Japan’s exports rose 3.9% in March, slowing from February’s 11.4% gain and missing expectations, as U.S. tariffs on autos and metals began taking effect. Exports to the U.S. grew just 3.1%, with automobiles accounting for over 28% of Japan’s U.S.-bound shipments. Despite a temporary suspension of a 24% “reciprocal” tariff, trade talks with the U.S. continue, covering tariffs, military costs, and trade fairness. Japan’s trade deficit narrowed slightly, while imports rose 2%, also below forecasts.
• U.K. inflation eased to 2.6% in March, down from 2.8% in February, driven by falling petrol and recreational goods prices, according to the ONS. While this provides short-term relief, analysts expect inflation to rebound to around 3.5% later in the year due to rising energy and business costs. Despite slowing inflation, wage growth—especially in the public sector—remains strong at 5.9%. Economists predict the weak economy and disinflationary effects from U.S. tariffs may push inflation lower in the long run, with the Bank of England likely to begin cutting interest rates as early as May.
• Amid an ongoing trade war, confusion arose after a White House document referenced 245% tariffs on some Chinese goods. However, officials clarified that the new tariffs remain at 145%, and the 245% figure reflects the cumulative impact of existing and new tariffs from the Biden and Trump administrations. Products like electric vehicles and syringes, already subject to 100% tariffs, are now facing the combined total. China’s Foreign Ministry declined to clarify the number, pointing reporters back to U.S. officials. Trump’s recent tariffs include 125% on goods and 20% targeting fentanyl-related enforcement.
• On 18/04/2025, President Donald Trump has renewed his criticism of Federal Reserve Chair Jerome Powell, calling for interest rate cuts and even suggesting Powell’s removal. In a Truth Social post, Trump slammed Powell as “Too Late Jerome” for delaying rate cuts despite falling oil and grocery prices, and claimed the U.S. is benefitting from tariffs. Although a White House official downplayed the post as frustration rather than a firing threat, Trump later told reporters he was unhappy with Powell’s performance and hinted he could remove him quickly. This marks the first time Trump has openly floated terminating Powell, whose term runs through May 2026.
• The European Central Bank cut interest rates by 25 basis points on Thursday, lowering its key deposit rate to 2.25% amid growing concerns over global trade tensions and their impact on euro zone growth. The move, widely expected by markets, follows a series of rate hikes that peaked at 4% in mid-2023. The ECB cited deteriorating economic outlooks and rising uncertainty from tariff disputes as key reasons for the cut, warning of reduced confidence and tighter financing conditions. Despite the challenges, the ECB noted that disinflation is progressing and inflation is expected to stabilize around its 2% target.
• Japan’s inflation rose 3.6% in March, marking three consecutive years above the Bank of Japan’s 2% target, though slightly below February’s 3.7%. Core-core inflation, excluding fresh food and energy, rose to 2.9%, while core inflation aligned with forecasts at 3.2%. Despite stronger inflation, U.S. tariffs and trade tensions may limit the BOJ’s ability to hike rates. Nomura now expects only one rate hike by January 2026, citing near-zero GDP growth and downward pressure on wages from the Trump administration’s tariffs.
• On 21/04/2025, President Donald Trump intensified his criticism of Federal Reserve Chair Jerome Powell, urging interest rate cuts and questioning Powell’s competence. Trump’s latest remarks, calling Powell “Too Late,” came amid reports that the White House is exploring legal grounds for removing him—despite Powell asserting his term runs through May 2026 and that he cannot be fired under current law. The tension escalated after Powell warned that Trump’s tariffs could fuel inflation and complicate the Fed’s dual mandate. While the Fed holds rates steady, political pressure mounts, prompting concern among lawmakers like Sen. Elizabeth Warren, who warned that firing Powell could destabilize markets.
• South Korea’s acting president Han Duck-soo stated the country “will not fight back” against recent U.S. tariffs, citing historical gratitude toward Washington for its post-war aid and support. As trade talks with President Trump’s administration begin, Han emphasized a “win-win” approach over confrontation, despite South Korean industries facing 25% levies on cars, chips, and pharmaceuticals. Seoul is open to reducing its $55 billion trade surplus by buying U.S. LNG and aircraft, and discussing non-tariff barriers. Han acknowledged some sectors might suffer but sees liberalized trade as beneficial overall. He also signaled potential willingness to revisit military cost-sharing agreements, though concerns remain about the legitimacy of his negotiating authority ahead of South Korea’s June snap presidential election following President Yoon’s impeachment.
• On 22/04/2025, India, the world’s second-largest crude steel producer, has imposed a 12% temporary safeguard tariff on select steel imports for 200 days to counter a surge in cheap shipments, mainly from China, which has pressured local mills to cut operations and consider layoffs. This marks India’s first major trade policy move following U.S. President Trump’s sweeping global tariffs. The tariff, announced by the Ministry of Finance, follows an investigation that began in December and aims to protect domestic manufacturers and maintain fair market competition, according to Steel Minister H. D. Kumaraswamy.
• Gold prices soared to a record $3,425.30 per ounce on Monday, rising nearly 3% as investor confidence in the U.S. economy waned amid President Trump’s escalating attacks on Federal Reserve Chair Jerome Powell and sweeping tariffs. The metal has surged 30% year-to-date and 8% since Trump’s tariff announcement on April 2, with demand boosted by a weakening dollar and central bank buying. Trump has labeled Powell a “major loser” and is exploring whether he can remove him, prompting further market jitters. Citi forecasts gold could reach $3,500 within three months due to sustained demand and global economic concerns.
• On 23/04/2025, U.S. Treasury Secretary Scott Bessent told investors at a private JPMorgan summit that he expects a near-term de-escalation in the trade war with China, calling the current high tariffs on both sides “unsustainable.” Despite the U.S. imposing 145% tariffs and China retaliating with 125%, Bessent said the goal isn’t decoupling and hinted at a lengthy negotiation process ahead. His comments boosted market optimism, sending stocks higher. White House press secretary Karoline Leavitt echoed his remarks, noting Trump is “setting the stage” for a potential deal, although no direct talks with President Xi have been confirmed yet.
• The International Monetary Fund (IMF) has downgraded its 2025 growth forecasts for major Asian economies, citing escalating trade tensions and high policy uncertainty. China’s GDP projection was cut from 4.6% to 4%, well below its official 5% target. India’s outlook was lowered from 6.5% to 6.2%, and Japan’s from 1.1% to 0.6%. Global growth is now forecast at 2.8% for 2025, down from 3.3%, with the IMF warning that widespread tariffs—particularly from the U.S.—pose a significant drag on economic activity. These cuts align with recent downward revisions from firms like Goldman Sachs and Fitch, as U.S.-China trade hostilities intensify.
• On 25/05/2025, China has stated that there are no ongoing trade or economic negotiations with the U.S., contradicting recent suggestions from President Trump and Treasury Secretary Scott Bessent that tensions with Beijing might ease. Chinese Ministry of Commerce spokesperson He Yadong emphasized that all claims of progress are unfounded and insisted the U.S. must first cancel its unilateral tariffs. This follows the U.S. imposing 145% tariffs on Chinese goods, which China countered with its own tariffs and restrictions on critical mineral exports. Chinese officials reiterated willingness to talk only if treated as equals, reflecting a strategic pivot towards prioritizing national interests amid inconsistent U.S. policy. Economists note that China’s stance is increasingly hawkish, especially as the trade war continues to harm both economies, prompting Wall Street banks to lower China’s GDP forecasts. China is also redirecting export goods toward domestic markets, while maintaining that any meaningful talks require significant U.S. tariff reductions—something politically challenging for Trump given the optics of backtracking on his trade strategy.
• Bank of Latvia Governor Mārtiņš Kazāks sees the current global uncertainty around trade tariffs as a critical moment for Europe to step up as an economic and geopolitical superpower. Speaking at the IMF-World Bank spring meetings, Kazāks argued that while the tariff war and political instability have heightened global economic vulnerability, they also present a strategic opportunity for the EU to deepen integration—such as through a capital markets union, fiscal union, and a unified services market. He emphasized that realizing this potential requires political courage. Regarding the European Central Bank’s policy direction, Kazāks said decisions would remain data-dependent due to the poor visibility created by global tensions. Although financial markets have so far remained stable, he warned that the elevated uncertainty surrounding tariffs and geopolitical developments means that multiple macroeconomic scenarios are equally likely, making it difficult to predict outcomes. He also expressed concern about the impact on growth once the current 90-day tariff pause ends in July.
• South Korea and the U.S. began trade talks aiming to finalize a deal by July 8 to remove new U.S. tariffs before reciprocal measures resume. Discussions focused on tariffs, economic security, investment, and currency policy, with South Korea requesting exemptions and proposing cooperation in shipbuilding and energy. Talks will continue in May, though progress may be affected by South Korea’s upcoming snap election.
• On 26/04/2025, China has quietly removed 125% retaliatory tariffs on some U.S.-made semiconductors and aircraft parts, such as engines and landing gear, in an effort to support its tech sector amid ongoing trade tensions with the U.S. Though not officially announced, local Shenzhen customs notified companies of the exemptions, which apply mainly to logic chips—excluding memory chips. These moves highlight China’s continued reliance on U.S. chip technology and its push to shield critical industries from the trade war’s impact. The exemptions follow Trump’s partial tariff rollback on electronics and his softer tone on trade talks, though Beijing denies any negotiations are underway.
• On 29/04/2025, China has denied any ongoing tariff negotiations with the U.S., contradicting recent claims by President Trump and his officials. Chinese authorities insist no talks or presidential calls have occurred, maintaining that the U.S. must first remove its unilateral tariffs. Meanwhile, Trump’s team continues to suggest discussions are happening and a resolution is near, despite growing economic concerns and conflicting public statements.
• Temu has begun adding steep “import charges” of around 145% in response to President Trump’s new tariffs on Chinese goods, significantly increasing order costs—often more than doubling prices. The added fees cover customs-related expenses but may exceed actual customs duties. Rival Shein has raised prices too but includes tariffs in the listed prices without separate surcharges. Both retailers had warned of price hikes as the U.S. ends the de minimis exemption on May 2. The changes undermine Temu’s low-price appeal, leading to a sharp drop in its U.S. app ranking and reduced ad spending.
• Chinese manufacturers are halting production and seeking new markets as U.S. tariffs take a toll, leading to job cuts and factory slowdowns, especially in export hubs like Yiwu and Dongguan. Consulting firms report furloughed workers and idle lines in industries such as toys and low-cost goods. With 10–20 million Chinese jobs tied to U.S.-bound exports, the situation is worsening, and some small exporters may not survive. Despite U.S. claims of ongoing trade talks, China denies any negotiations, while supply chain firms scramble to help clients find non-Chinese suppliers amid the escalating tariff war.
• On 30/04/2025, President Trump said trade negotiations with India are progressing well and expects a deal soon, following Prime Minister Modi’s recent visit to Washington. Treasury Secretary Scott Bessent confirmed the U.S. is close to finalizing terms, with ongoing talks also involving Japan and South Korea. Vice President JD Vance and Modi reportedly made significant progress last week. Economist Raghuram Rajan noted that a lower tariff agreement could make India more attractive to global companies, especially given its large domestic market. The U.S. is currently engaging with 17 key trading partners, excluding China.