Over the weekend, news emerged that the Trump administration are moving towards more targeted tariffs with some countries likely to be exempt. The scope of the tariffs are expected to be narrower than initially planned.
*Daily move - against G10 rates at 7:30am, 24.03.25
** Indicative rates - interbank rates at 7:30am, 24.03.25
Markets continue the countdown to “US Liberation Day” on 2nd April, with the news of more targeted tariffs seeing risk sentiment slightly stronger this morning.
Today's focus falls on PMI numbers from Europe, UK and the US. Anything to suggest that each respective economy is in better shape than it was in February could call into question future rate cut pricing for this year, particularly from the ECB where markets are assigning a 60% chance of a rate cut in April.
Big week for the UK with the release of CPI numbers and the Spring Budget on Wednesday, and retails sales on Friday. Headline CPI is expected to slow to 2.9% from 3%; and services CPI is expected to slow to 4.9% from 5%. With the budget, markets are not expecting any positive surprises and the OBR is expected to revise down productivity for the rest of the year. Overall this week could prove to be risky for GBP.
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