4th April 2025

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TRADE:

• US President Trump said he was open to reducing his tariffs if other nations were able to offer something “phenomenal”. Trump also said he was happy that interest rates were falling and believed that economic turbulence would settle. (BBG)
• Trump reiterated that he would in particular be willing to offer tariff relief for China if Beijing approved the sale of the US operations of ByteDance Ltd.’s TikTok social video app. (BBG)
• White House officials have circulated internal talking points telling surrogates that Trump’s new global tariff regime should not be characterized as a starting point for negotiations. The administration’s internal instructions say advisers should characterize the tariffs as a response to a national emergency, rather than the basis for potential trade talks. (WaPo)
• Top Trump trade advisor Peter Navarro denied that Trump’s new tariffs are being used as a tool to negotiate better trade terms with other countries, saying they are here to stay. He also said its impossible that EU is going to give up their protections. (CNBC)
• US NEC Director Hassett said he thinks the EU is unlikely to change its policy much in response to US actions, and because of that, the tariff on the EU will stay the same, but "if they do come back and make a deal with the President of course he will listen because what he cares about is the American worker." (Fox News)
• US VP Vance said he thought 'in some ways it could be worse in the markets' following tariffs. (Newsmax)
• Trump's tariffs are opening a rift among top Republicans in Washington, threatening to split the party. (FT)
• The EU's response tariff first response is being delayed by certain bloc members such as France, Italy, and Ireland who want certain industries taken off the retaliatory list, which is set to be sent to member states on Monday with a vote planned for next week which could then be passed into law on April 15th, but only apply a month later. (FT)
• EU diplomat suggests US Commerce Secretary Lutnick, who is meeting EU's Sefcovic on Friday, has little sway with Trump, whereas trade advisor Peter Navarro is calling the shots. (FT)
• French Finance Minister Lombard said the EU's response to new US tariffs will be proportionate, and intended to bring the EU and US to the negotiating table. Said the EU shouldn't retaliate with exactly the same tools as the US as it would impact EU consumers. Lombard also said the EU is working on a package that goes beyond tariffs. (RTRS)
• French Finance Minsiter Lombard, on Macron's call for investment suspension in the US, said companies are free to decide if they would suspend investment in the US. (RTRS)
• Canadian tariffs on US autos announced on Thursday will apply to C$35.6 billion worth of imports, according to a Canadian government official. (RTRS)
• "The Rest of the World Is Bracing for a Flood of Cheap Chinese Goods", WSJ article notes Trump’s tariffs risk domino effect across the globe as Chinese goods look for new markets. (WSJ)
• Europe braces for flood of Chinese goods after US tariffs. (FT)
• WSJ article titled "Americans Rush to Buy TVs, Soy Sauce, Lululemon Workout Gear", highlights a surge in retail activity ahead of Trump’s new tariffs. (WSJ)
• Exporters from drugmakers to tech hardware manufacturers have been paying almost 40% more to fly goods into the US from China than they were four weeks ago amid a pre-tariff surge in trade. (FT)
• South Korea, the US and Japan have agreed to strengthen energy cooperation underpinned by U.S. LNG sources, a joint statement by the three countries' foreign ministers said on Friday. (RTRS)

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MACRO:

• 'Inflation fears add to pressure on Federal Reserve'. FT article highlights surging short term inflation expectations that could lead to a broader unanchoring that risks threatening the Fed's stimulatory response to any growth slowdown from tariffs. (FT)
• The risk of a U.S. and global recession this year have risen to 60% from 40% on the heels of Trump's tariffs, J.P. Morgan said. The bank says tariffs amount to the largest tax hike since 1968. The bank reiterated its forecast of two 25bp Fed cuts in June and September. (RTRS)
• Japanese household spending fell for the first time in three months in February, highlighting consumer wariness in the face of high prices and signalling a sustainable recovery is some way off. (RTRS)
• BoJ Governor Ueda warned of a hit to Japan economy from Trump's tariffs, with uncertainty having heightened after the announcement. He said the inflationary impact is unclear at this stage, warning it could be deflationary if growth stumbles. (RTRS)
• BoJ Deputy Governor Uchida said the bank will keep raising interest rates if the chance of underlying inflation achieving its 2% target heightens. (RTRS)
• Amid global tariff woes, softening consumer data, and dovish Ueda comments, the 10yr JGB yield fell 17.5bps to 1.185%, its lowest level since January 29th and the biggest decline since August 5th, down nearly 37bps this week, the steepest weekly fall since 1992. (Newswires)
• Analysts says China’s reaction to new U.S. tariffs will likely focus on domestic stimulus and strengthening ties with trading partners. (CNBC)
• German factory orders stagnated in February, a weaker-than-expected reading despite signs of frontloading ahead of tariffs that have roiled markets in recent days. (WSJ)
• French Finance Minister Lombard said France will not change spending plans for 2025. (Newswires)
• SocGen strats say there is room for German Bunds for even higher term premium versus U.S. Treasuryies. “Bunds’ relative value is exposed to expectations of possibly even deeper, faster fiscal easing by Germany, which is the EU country hardest hit by U.S. tariffs,” the bank says, which maintains short positions in Bunds versus U.S. Treasurys. (WSJ)
• Australian household spending rose for a fifth straight month in February, data showed on Friday, but the gains were slim and overall growth remained modest as consumers struggled with cost-of-living pressures. (RTRS)
• Reuters economist poll sees the RBNZ cutting rates by 25bps on April 9th, who have held to their previous rate outlook as inflation is expected to remain under control. (RTRS)
• South Korea’s top court voted unanimously to dismiss the country’s impeached president, Yoon Suk Yeol, on Friday. The decision clears the way for the election of a new leader after months of political turmoil that has tested its democratic guardrails. (NYT)

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GEOPOLITICAL:

• A top Kremlin envoy completed two days of talks with President Trump’s Russia negotiator at the White House on Thursday, the first high-level bilateral meeting in the U.S. since before the invasion of Ukraine in 2022. (WSJ)
• Russia and the US are discussing resuming direct flights, according to TASS citing Kremlin’s envoy Dmitriev after talks with the US. (Newswires)
• Trump’s tariffs threaten US weapons production. If implemented as planned, tariffs could muddle global supply chains the Pentagon has spent decades creating, make American weapons more expensive, and complicate international efforts to counter China. (Politico)
• Trump said he thinks Tehran wants to negotiate with Washington directly over Iran's nuclear program. (RTRS)
• US Gen. Timothy Haugh, the director of the NSA, was fired Thursday along with his civilian deputy at the NSA, Wendy Noble, after calls for dismissals from activist Laura Loomer, who met with Trump on Wednesday. (WaPo)
• Brussels must be legally “innovative” to prevent Hungary from blocking support to Ukraine or easing pressure on Russia, Finland’s defence minister has said. (FT)
• EU's Kallas said US Secretary of State Rubio made assurances that the US will not make concessions that go against the interests and the red lines of Ukraine and Europe. (RTRS)

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EQUITIES:

• Meta and the US FTC are set to face off in federal court this month, in the first big test of whether the new Donald Trump-appointed antitrust regulator will continue to crack down on Big Tech. (FT)
• Nvidia has seen renewed reporting around chip delays, Digitimes reports, citing supply chain experts, that given the current indecisiveness in many aspects of the design of the latest Blackwell (GB300) chip, achieving a timely launch in the third quarter seems unlikely, with estimates suggesting a slight delay until the end of the year or even into 2026. (Digitimes)
• EU prepares major penalties against Elon Musk's X and is considering a fine of over $1bln. (NYT)
• 'Trump tariffs could stymie Big Tech's US data center spending spree', Reuters reports, noting tariffs could disrupt data-center equipment supply chains, while tech giants may reallocate spending due to tariff impact. Cloud service providers may also face potential spending cutbacks. (RTRS)
• Elliott Management said that Phillips 66's stock price could nearly double to $200 if the oil refiner sells or spins off its midstream business and puts more focus on refining and enhances oversight. Elliott also nominated four executives to stand for election as directors the board. (RTRS)
• BP’s Chairman Helge Lund will step down sometime next year, as activist investor Elliott Management pushes for changes at the British oil major. (WSJ)
• Shell said it would sell its 16.125% stake in Colonial Enterprises to Brookfield Infrastructure Partners for $1.45 billion as it continues to simplify is portfolio. (WSJ)
• Santander said it expects to report growth for the first quarter of 2025 and confirmed its guidance for the year. (WSJ)
• Volvo will increase its investment in a truck factory it is building in Mexico to $1 billion, the country’s economy minister said Friday. (WSJ)
• Shares of Japanese banks plunged on Friday as tariffs sparked fears of a downturn in global growth that could choke off a fragile recovery and delay BoJ rate hikes. Japan banking index slides 11%, set for biggest one-day drop since August. (RTRS)
• Nissan Motor said on Thursday it will halt new orders of two Mexican-built Infiniti SUVs for the U.S. market after new auto tariffs imposed by President Donald Trump took effect. (RTRS)

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