Market participants have largely shrugged off President Trump’s latest set of threats to raise tariffs on a range of countries, focusing on the fact that today’s “deadline” for re-imposing the “reciprocal tariffs” from 2nd April has, as widely expected, been extended. Our base case remains that, in aggregate, US effective tariff rates will remain around their current levels. While continued noise around tariffs could well generate some volatility in the near term, we think the bar for another major sell-off remains quite high.
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