People walk next to the New York Valuable Stock Exchange (NYSE) in front of the closed bell and the start of the press conference of President Donald Trump about tariffs on April 2, 2025 in New York.
Spencer Platt Getty images
US President Donald Trump He offered his commercial partners – and financial markets – on Wednesday, when he withdrew parts of his tariff policy.
The latest tariff rates specific to the country announced on April 2 were dropped up to 10% for 90 days to buy time for negotiations for most countries and territories.
Markets breathed a sigh of relief with Historical rally developing on Wall Street on Wednesday and transfer Asian AND European Markets on Thursday. But analysts note that economic and market damage can already be done and can be difficult to reverse.
“Although there was a relief as evidence that Trump was re -broadcast after extreme market conditions, which we emphasized yesterday morning, the genie is still beyond the bottle about the unpredictability of politics,” said a group of economists and strategists Deutsche Bank Research on Thursday.
The remaining 10% tariff is still the biggest increase in such obligations for decades and does not indicate much that US trade transactions can accept in negotiations, which means that uncertainty is to be continued, they added.
Meanwhile, Preston Caldwell, an American economist in Morningstar, suggested that the markets reacted too much to Trump's announcement, a warning about economic options, unless the tariff policy of the US president has changed even more.
“The market reacts too optimistically today, unless Trump announces further tariff reduction and reliably refrains from future increases in retaliation,” Caldwell said on Thursday in the note.
“The average tariff indicator today is still about 20%, with the tariff rate to China is about 125%, which is a de facto embargo,” he said, saying that there will be some corrections to the economic forecast, but adding that he is still expecting a “significant increase in inflation” and economic slowdown.
Stocks, economy, dollar
Damage inflicted by the uncertainty and feeling of changing, which arose as a result of frequent changes in politics, affect everything, from the wider US and the position of the country in the world's order to the stock market and the dollar, was noticed by analysts.
In the note, economists and strategists of the Deutsche Bank research pointed out that despite the S&P 500 rally by more than 9% during the Wednesday session “still left S & P 500 -3.77% below the level before mutual ads of the tariff on April 2”
S&P 500 Futures The last one fell by 2.1% at 9:44 in London.
American dollar, which was recorded after the sale for the first time tariffs in the country, also reflected after the announcement of Trump on Wednesday. Since then, he has made it easier again. . Dollar index He was last at 102.41, rapidly lower than the highest level of around 110 seen in January this year.
Chris Turner, a global head of markets in ING, said in a note that the Greenback indicator was to continue “trading in a variable range of 102.00-103.50”.
“And in the coming weeks it can come down again if it looks like a tariff shock has caused some damage to hard data in the American consumer and business space,” he added.
The economic influence in macro has already developed, despite the movement of the Trump signaling that the US administration is at least a bit reactive to the pressure of enterprises and markets, said George Saravelos, the global head of the FX research in Deutsche Bank, said in Wednesday's note.
“Even if the tariffs are permanently suspended, the damage was caused to the economy through a lasting sense of unpredictability in politics, “he said.
“The events of the last few weeks will be more structurally resonance among global economic partners during the upcoming negotiations on trade and even for many years. He wants to build a greater strategic independence from the USA on all fronts to stay.”
“We can cure ourselves”
Other such as Jim Caron, investment director of the Solutions Portfolio Group in Morgan Stanley Investment Management, maintain that the markets will eventually recover.
“We can cure ourselves,” said CNBC, “Squawk Box Europe“On Thursday.” It will take some time and rebuild self -confidence. “
Caron said that he expected Trump to take “less hot or more measured approach” to some of his tariff rules over time and create “victory” through negotiations. The market volatility was previously caused by the White House, which did not communicate with its plans and what significantly mean well, he suggested.
“Therefore, the damage caused are essentially a shock of trust, which made people demand a greater discount on the purchase of specific assets, and these can be bonds, and this could also be shares, and this is what we are going through,” Caron emphasized. “But with time – we saw shocks in the markets earlier – these things have a way to get crowded and healing.”