Highlights
A day before President Trump's midnight Thursday deadline for countries to reach a trade deal before reciprocal tariffs take effect, a flurry of announcements is likely. Canada, Mexico, China, Taiwan and India are among the major trading partners not accounted for.
Late on Wednesday, the president said he had reached an outline deal with South Korea calling for 15 percent tariff and more huge purchases of US energy. Earlier Wednesday he said no deal was likely with India and said that country would be subject to a 25 percent tariff plus unspecified penalties. The president escalated his conflict with Brazil and said that country would see a 50 percent tariff. Separately, Commerce Secretary Howard Lutnick said the US had reached deals with Cambodia and Thailand.
Meanwhile, the president said early Thursday Canada's provisional pledge to recognize a Palestinian state would make it very hard to reach a deal with Canada. Imports from Canada not covered by the U.S.-Mexico-Canada trade agreement will be subject to a 35 percent tariff if there is no deal.
Equity markets appear relatively sanguine about the outcome of these trade disputes as the S&P 500 and other major indexes have traded to record highs in the runup to Aug. 1. The president's use of tariffs as a lever in an array of policy disputes adds to the unpredictability. With India, for example, it's hard to know whether the president's threat of penalties in connection with India's purchases of Russian oil is primarily aimed at pressuring Russia to agree to a ceasefire in Ukraine or whether it is primarily aimed at pressuring India on trade.
Adding to the uncertainty: the president's tariff policy is under review Thursday by a U.S. appeals court after a lower court said he lacked authority to impose sweeping reciprocal tariffs imposed in April in addition to tariffs imposed in February against China, Canada and Mexico. The appeals court could suspend the tariffs, presumably pending review by the Supreme Court.
Definition
Market Focus details key factors in the coming day that will impact the economic outlook and the financial markets. These include central bank events, economic indicators, policymaker speeches as well as expected political and corporate developments.
Description
Keeping up-to-date with event schedules and the economic calendar is key to understanding the global financial system. Econoday's Market Focus allows investors and policymakers to carefully track what will be making news and moving the financial markets in the coming day.