TARIFFS: Trump Says Pharma Tariffs "Not Too Distant Future" Suggests Likely 25%
Apr-14 16:27
US President Donald Trump has delivered a wide-ranging press conference alongside Salvadoran President Nayib Bukele at the White House.
- On tariffs, Trump indicates that tariffs on pharmaceuticals will be coming shortly as the US needs to reshore pharma production. He namechecks Ireland as a pharma producer and says: “All I have to do is impose a tariff… The higher the tariff, the faster they come,” referring to companies relocating their manufacturing to the US.
- He says, “its going to be like we have on cars… We have, as you know, a 25% tariff on cars [steel and aluminum],” adding “that category fits right now [for pharma].” Asked about his timeline for implementation, he says: “not too distant future”. Trump declines to offer any information on potential semiconductor tariffs.
- When asked to clarify comments yesterday when he suggested a Russian attack on the Ukrainian city of Sumy was a “mistake”, Trump reiterates that the mistake was on the behalf of Ukrainian President Volodymyr Zelenskyy and former President Joe Biden for allowing the war to start.
- He again blames Zelenskyy for starting the war, “you don’t start a war against someone 20 times your size and then hope some people give you some missiles.” Trump adds that there are, “some proposals on stopping the Ukraine war very soon.”
- Trump says Iran cannot be allowed to acquire a nuclear weapon and notes the talks in Oman on Saturday. He acknowledges that Tehran could be stringing the US along by delaying talks.
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FED: March Economic Projections: Higher Inflation, Weaker Growth, Same Rates
Mar-14 21:28
The MNI Markets Team’s expectations for the updated Economic Projections in the March SEP are below.
- The unemployment rate is likely to rise slightly for 2025 alongside a downgrade in GDP growth, while the 2025 core and headline PCE inflation projections are set to rise again. Changes to later years will likely be limited, however.
- More detail on the shift in Fed funds rate medians is in our meeting preview - we will add more color next week.
FED: Market Pricing Nearly 3 2025 Cuts As Conditions Tighten
Mar-14 21:25
Amid rising government policy uncertainty, sentiment among businesses and consumers has fallen sharply since the start of the year, while equities and the dollar have reversed their post-election rise. Overall, financial conditions have tightened, even if stress is not yet mounting, e.g. no major widening of credit spreads (the accompanying chart shows the Fed’s financial conditions impulse index but only through January).
- Combined with growth fears, this has affected expectations for the Fed’s rate path, with around 18bp more cuts expected in 2025 compared with what was seen after the January FOMC. 65bp of cuts are priced for the year as a whole. 2025 cut pricing reached 71bp before the February inflation data and 76bp before the February payrolls report.
- A rate cut is seen with near zero probability for March’s meeting, but the first full cut is just about priced for June, with a second nearly priced by September.
- Chair Powell has no reason to endorse or refute these expectations – he’s likely to be happy with a press conference that ends with little discernable change in pricing.
CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
Mar-14 21:17
- CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
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