Germany: Ifo Index and expectationsToday, the key indicator in the eurozone will be the publication of the German Ifo index, which investors are carefully comparing with yesterday's PMI data. Of particular interest is the component of expectations present in the Ifo and absent in the PMI, as it is able to better reflect the impact of trade conflicts, in particular, between the United States and China.USA: moderately positive signals and political noiseDespite weak regional reports from the Fed, the index of business activity in the US industry unexpectedly rose to 50.7, surpassing expectations of 49.1. At the same time, the services sector weakened to 51.4, but remained above the threshold of stagnation. The composite index decreased from 53.5 to 51.2, which still indicates moderate growth. The weakening of export orders in both sectors was offset by steady domestic demand: new orders increased in industry, while they decreased slightly in the service sector.However, against the background of macroeconomic statistics, the political factor has become more active again. There were reports that it was the ministers of finance and trade, Bessent and Latnik, who dissuaded the president from firing Fed Chairman Powell. Bessent also commented on the situation regarding trade negotiations with China, saying that a full-fledged agreement may take 2-3 years, and the resumption of dialogue is impossible without reducing tariffs, which now reach 145% on Chinese goods and 125% on American goods. The possibility of tariff cuts of up to 50% is being discussed on the sidelines, but the White House has not yet confirmed these rumors. This news caused cautious optimism and increased the probability of a deal with China to 38% from 34% previously.An additional boost to the market was given by information from the Financial Times, according to which the US administration may consider the possibility of partially exempting automakers from import duties after appropriate lobbying efforts by the industry.Eurozone: weakness in the service sectorThe combined eurozone business activity index fell to 50.1 in April, while the drop in the services sector to 49.7 was unexpected. On the contrary, the manufacturing PMI showed positive dynamics, exceeding forecasts and reaching 48.7. Despite this, pressure on the ECB towards additional easing remains, especially since the price components also indicate a weakening of the inflationary pressure. The employment rate in the service sector, however, remains positive at 50.8, which mitigates the negative effect of the decline in the overall index.The update of the ECB wage index also indicates a slowdown in wage growth in 2025, which strengthens the case for lower rates. According to current expectations, the deposit rate may be lowered to 1.5% by September 2025.UK: alarming signs of stagflationThe PMI figures for April in the UK turned out to be worse than expected across the board. The composite index fell to 48.2, signaling a reduction in business activity. The indices for services and production were 48.9 and 44.0, respectively. At the same time, there is an increase in both incoming and outgoing prices, and employment continues to decline. This combination indicates the risk of a stagflationary scenario, which significantly complicates the task of the Bank of England in terms of monetary policy.Energy market: uncertainty over OPEC+ quotasOil prices fell by 2% after reports that several OPEC+ countries called for an additional increase in production in June, similar to the decision taken in May. Kazakhstan, in turn, stated that it was not ready to compensate for the excess production of the previous period with cuts. Eight OPEC+ countries will meet on May 5 to discuss the future quota. Due to continued pressure on prices in the second quarter, the average Brent price is expected to be around $70 per barrel, with a subsequent recovery to $85 in the fourth quarter.Stock markets: rising amid political optimismBuyers prevailed on stock markets, despite contradictory macro data. Cyclical sectors led the way, both in the USA and in Europe. The market continues to live under the influence of paradoxes: rising bond yields, a strengthening dollar, and a simultaneous rally in risky assets. The profitable reports of the companies also added to the positive. Indices in the USA ended the day with growth: Dow +1,1%, S&P 500 +1,7%, Nasdaq +2,5%, Russell 2000 +1,5%. However, Asia has been showing a decline since this morning, and futures for the United States and Europe also point to a correction amid cooling political optimism.Bonds and the foreign exchange market: caution returnsWhile Finance Minister Bessant acknowledged the excesses of the current tariffs on Chinese goods, he emphasized the strategic task of redefining U.S. global economic relations. His speech cooled the euphoria of the markets: the yield on 10-year US Treasury bonds rebounded from daily lows and reached 4.39%, indicating an increase in expectations for inflation and interest ...
USA: awaiting reports on the labor market and consumer sentimentTwo important macroeconomic reports will be released in the United States today — the March JOLTs on hiring dynamics and the April consumer confidence index from the Conference Board. Job vacancy data is a key indicator of the state of labor demand for the Fed. Despite the uncertainty caused by the tariff policy, stable data on daily job advertisements suggest that demand remains at an acceptable level.The Eurozone: Spanish inflation and business activityOn European platforms, attention will be focused on the publication of inflation data in Spain for April. This release precedes the general report on inflation in the eurozone, which will be released on Friday. The HICP index is expected to slow growth from 2.2% to 2.1% in annual terms.Of additional interest are data on lending and business sentiment in the eurozone for April, which will be able to reflect the first effects of the new US tariffs.China: expectation of a decline in manufacturing activityIn Asia, the PMI indices for April from NBS and private Caixin will be published. According to expectations, both indicators will show a decline, confirming the negative impact of the ongoing trade war. The previously published Emerging Industries PMI dropped sharply from 59.6 to 49.4 points.Sweden: macroeconomic releases and growth prospectsSwedish statistics today are rich in publications. At 08:00 CET, reports on retail sales and consumer lending for March are expected. The GDP indicator for the first quarter will attract special attention, however, due to its volatility, analysts prefer the NIER economic sentiment index, which will be released at 09:00 CET. Its further decline may signal a slowdown in the Swedish economy.Norway: retail sales remain questionableRetail sales statistics for March will be published in Norway. Despite the global instability, it is unlikely to be reflected in these data. Sales growth is forecast to slow to 0.1% month-on-month, although the effect of postponing holidays makes it difficult to assess the real state of consumer activity.Economic and market news: key eventsCanadian Elections: liberal victoryIn the last parliamentary elections in Canada, the Liberal Party under the leadership of Mark Carney retained power. Although the results had not yet provided them with a full majority in parliament at the time of publication, the victory marks the restoration of the party's position after the resignation of Justin Trudeau. Carney relied on his reputation, formed during the crisis of 2008 and the Brexit process.Macroeconomic data from Denmark, Sweden and NorwayIn Denmark, retail sales in March unexpectedly decreased by 0.1% compared to February, mainly due to lower food costs. However, clothing sales increased by 2.7%.In Sweden, the producer price index decreased for the second month in a row (-3.0% mom, -0.3% YoY), which reduces inflation risks and supports the Riksbank's position.In Norway, the unemployment rate rose to 4.4% in March, but the adjusted data remained unchanged at 4.1%. More recent unemployment statistics will be published on Friday.Geopolitics: the Truce in UkraineRussian President Vladimir Putin announced a three-day truce from May 8-10 in honor of the anniversary of the end of World War II, inviting world leaders to events. Ukraine has criticized, insisting on the need for an immediate and full-fledged ceasefire. The White House supported the idea of a truce, but stressed that the goal should be a long-term peace initiative.Stock markets: stabilization and local successesThe trading session in the American markets passed without significant changes, while the European indices showed growth: the Stoxx 600 added 0.5%. Shares of companies in defensive sectors such as real estate, utilities and healthcare rose against the background of lower bond yields. The VIX volatility index has stabilized around 25 points, which may indicate prolonged uncertainty due to tariff policy.Debt and currency markets: declining yields in the United StatesAt the start of the week, US Treasury bonds continued to rise in price: the yield on 2-year securities decreased by 6 basis points, 10-year — by 3 bps, and 30-year— by 2 bps. European yields, on the contrary, rose slightly. The EUR/USD pair remained stable in the range of 1.13–1.14. The victory of the liberals in Canada led to a moderate strengthening of the Canadian dollar, and a further decline in the USD/CAD pair is expected to reach 1.37. The Norwegian krone also showed good results at the end of yesterday's ...
The beginning of the week promises to be relatively calm on the macroeconomic front. In Denmark, the retail trade index for March will be published today at 08:00 Central European time. According to its own expense monitor, real retail sales decreased by 2.5% year-on-year. However, the decrease is due to the calendar effect: Easter last year fell in March, and this year in April. Seasonally adjusted, real sales increased by 1.8% compared to February, and official statistics are expected to reflect this positive trend.In Sweden, the producer price index for March will be published at the same time. These data, as well as the results of the NIER price Expectations survey published earlier this week, will be important for shaping inflation expectations and, consequently, for further actions by the Riksbank regarding changes in interest rates.Main events of the weekDuring the week, investors' attention will be focused on a variety of key publications. On Wednesday, PMI data from China and a preliminary estimate of US GDP for the first quarter are expected. On Thursday, attention will turn to the Bank of Japan's monetary policy meeting. On Friday, preliminary data on inflation in the eurozone and the US employment report for April will be released.Friday and weekend eventsIn the United States, the University of Michigan consumer sentiment index for April was revised upward to 52.2 points from an initial 50.8. Despite the revision, the index continues to decline for the fourth month in a row and is at its lowest level since July 2022. Uncertainty in trade policy and fears of rising inflation remain the reason for the deterioration in sentiment. Inflation expectations for the year ahead jumped to 6.5%, due to recent tariff initiatives, although the preliminary estimate was even higher — 6.7%.In Japan, Tokyo inflation (excluding fresh produce) accelerated to 3.4% in April, exceeding forecasts. This confirms the existence of stable inflationary pressures. The head of the Bank of Japan, Ueda, confirmed that further rate increases are possible if inflation approaches the target level of 2%. However, he noted that a trade war could weaken inflationary trends. Following this, we expect one of the two planned rate increases to be postponed to the fall and another to the first quarter of 2026.In China, industrial profits increased by 0.8% year-on-year in the first three months of 2025, which is a recovery from the recession at the beginning of the year. At the same time, private sector profits decreased by only 0.3%, which is significantly better than the previous drop of 9%.The US-China Trade War: conflicting signalsDespite President Trump's statements about the ongoing negotiations with Chinese President Xi Jinping, Beijing has denied the fact of such negotiations. The US Treasury Secretary announced cooperation with Chinese representatives at the IMF meetings, but without discussing tariff issues. The Minister of Agriculture, in turn, noted the daily contacts on the topic of tariffs.Geopolitics: the meeting between Trump and ZelenskyIn Rome, as part of the funeral of Pope Francis, the first meeting between Donald Trump and Vladimir Zelensky took place since February. The negotiations were described as "very productive." Trump condemned Russia's recent attacks on civilian facilities in Ukraine and stressed the need to find alternative methods of pressure, including secondary sanctions. At the same time, US Secretary of State Marco Rubio announced the possible curtailment of peace initiatives if Russia and Ukraine do not show progress in negotiations.Greenland and Denmark strengthen their allianceAmid renewed U.S. interest in acquiring Greenland, autonomy's Prime Minister Jens-Frederik Nielsen visited Copenhagen. The meeting with Danish Prime Minister Mette Frederiksen ended with a joint statement of unity: the fate of the island will be decided solely by the Greenlanders.Equity markets: recovery continuesThe past week has brought significant growth in the stock markets: the S&P 500 index has gained 5%, and the European and Scandinavian indexes — about 3%. Cyclical securities grew especially strongly, outperforming defensive assets by more than 5%. On Friday, the growth continued: the S&P 500 gained 0.7%, the Stoxx 600 - 0.4%. Asian markets are showing neutral dynamics this morning, and futures on US indices are slightly declining.Debt and foreign exchange markets: moderate movementsLast week ended with a decline in US government bond yields: yields on 2-year securities fell by 5 basis points, while 10- and 30-year yields fell by 8 points. The yield curve has straightened somewhat. In Europe, yields, on the contrary, rose slightly, despite the soft comments from ECB representatives. In the foreign exchange market, the EUR/USD pair consolidated in the range of 1.13–1.14. The franc and the yen weakened slightly amid an improvement in global risk appetite. This week, the focus will be on data on inflation, GDP and the labor market in the United States and the eurozone, as well as the meeting of the Bank of ...
The EUR/GBP pair shows uncertain dynamics during the morning session, hovering near the level of 0.8530. The lack of a clear trend is explained by a balanced macroeconomic background, where positive data from the UK is offset by cautious optimism in the eurozone.The March statistics on British consumption exceeded expectations- Annual retail sales growth accelerated to 2.6% (1.8% forecast)- The base indicator (excluding fuel) increased by 3.3% year-on-yearHowever, the April Gfk consumer confidence index deteriorated to -23 points, indicating continued household concerns. The CBI's industrial orders data (-26 points) turned out to be better than expected, but export orders fell to their lowest level since September, reflecting the pressure of global trade risks.German business sentiment (IFO index) showed resilience- The current situation index rose to 86.4 points- The business climate improved to 86.9 pointsAt the same time, the IFO president warned of growing uncertainty among companies due to US tariffs. Comments by ECB representative Claes Noth highlighted the risks of slowing inflation, but retained the possibility of its acceleration in the medium term.EUR/GBP technical analysis for today- Bollinger bands signal a potential downward reversal- The MACD retains a bearish signal- The stochastic oscillator indicator in the oversold zone may limit further declineTrading recommendations- Short positions at the breakdown of 0.8519 with a target of 0.8465 (stop loss of 0.8546)- Purchases on the rebound from 0.8519 and growth above 0.8546 with a target of 0.8601 (stop loss ...
Key events of the dayToday, the markets' attention is focused on the preliminary business activity indices (PMI) for April in the eurozone, the United States and the United Kingdom. These data will be the first indicator of the impact of uncertainty related to trade tariffs. In the eurozone, the manufacturing PMI is expected to decline to 48.2 from the previous level of 48.6, due to a drop in new orders from the United States. At the same time, the index in the service sector is likely to remain stable at around 51.0. Despite the fact that the PMI is usually less sensitive to sentiment, the risks of a negative effect still remain.In the United States, a similar dynamic is expected: a decline in industrial activity against the backdrop of gloomy data from the Philadelphia Fed index published last week. The service sector is expected to hold its position unless increased uncertainty begins to put pressure on consumption. However, March retail sales showed resilience, which reduces risks.Economic developments in AsiaIn Japan, the April PMIs showed mixed results. The manufacturing index continued to decline for the tenth month in a row, dropping to 48.5, partly due to concerns about U.S. tariffs. The service sector, on the contrary, grew to 52.2, driven by increased customer demand and the largest increase in sales over the past three months. Pressure on prices has increased: companies are recording the fastest cost growth in two years, leading to higher product prices. The composite index returned to the expansion zone, rising to 51.1 from 48.9 in March.Economic developments in the USAThe index of manufacturing activity of the Federal Reserve Bank of Richmond deteriorated in April to -13 from -4 in March. The shipment component decreased to -17, which, together with data from the Federal Reserve Bank of Philadelphia, signals a clear deterioration in the industrial situation. The effect of pre-accumulation of orders in the first quarter is being replaced by a slowdown due to increasing uncertainty.In the political arena, President Trump has eased pressure on the Fed, saying there are no plans to fire Jerome Powell. This led to a decrease in the probability of his resignation in the markets from 21% to 13%, supporting a positive mood among investors, strengthening the dollar and sending gold into a downward correction. Prior to Trump's statement, U.S. Treasury Secretary Bessant also described the trade war with China as "unsustainable," which gave an additional boost to asset growth. At the same time, Trump expressed cautious optimism about the deal with China, noting that tariffs would eventually be "significantly lower" but not reduced to zero.Events in EuropeIn the eurozone, the consumer confidence index dropped to -16.7 in April, which is the lowest level since November 2023. The decline is mainly due to the effects of the trade war and falling stock markets. So far, this deterioration has not been reflected in real data — retail sales in the United States in March, as well as transaction data in Denmark, remain strong. Thus, the decrease in confidence so far looks more like an emotional reaction to external factors.According to the quarterly survey of the European Central Bank among professional forecasters, inflation expectations have slightly increased, and economic growth forecasts have been slightly revised downwards. However, the changes turned out to be insignificant, indicating moderate expectations of further consequences of the trade war. The next round of forecasts may be less optimistic due to the escalation of tariff conflicts between the United States and China in April.International trade and macroeconomicsTrade disputes remain in the spotlight: The International Monetary Fund has revised down its global economic growth forecast for 2025, noting particularly significant declines for the United States and China. The main threats are the further escalation of trade wars and the tightening of financial conditions.The situation in SwedenAn unexpected improvement was recorded in the Swedish labor market: the unemployment rate fell to 8.1% in March from 8.9% in February. At the same time, employment growth was higher than expected, and the increase in the workforce was in line with forecasts. However, risks of deterioration remain in the event of escalating tariff conflicts and turbulence in the stock markets.Geopolitical newsProgress has been made in relations between Russia and Ukraine. According to media reports, Russia offered to stop the offensive on the current front lines, and Ukraine expressed its readiness for negotiations after the establishment of a ceasefire.The raw materials marketOil prices have strengthened amid the introduction of new US sanctions against Iranian oil exports, as well as due to improved market sentiment following the softening of US rhetoric towards China. A barrel of Brent costs about $68 in the morning.Stock marketsGlobal stock markets showed solid growth, offsetting the drop at the beginning of the week. Cyclical stocks outpaced defensive sectors in growth. Bond yields declined, and the dollar strengthened. Major US indexes closed in positive territory: Dow +2.7%, S&P 500 +2.5%, Nasdaq +2.7% and Russell 2000 +2.7%. The positive mood remains for the morning in Asia, as well as on European and American futures.Debt market and foreign exchange marketThe weakening of Trump's rhetoric towards the Fed chairman and trade negotiations with China contributed to the relief in financial markets. Today's PMI releases will be an important indicator of the current state of the global economy and will play a key role in further decisions by central ...
Macroeconomic background: expectations for the dayToday promises to be a calm day in terms of the release of macroeconomic data. Market participants' attention remains focused on uncertainty in global trade and possible signals from US President Donald Trump.In the eurozone, the focus will be on the April consumer confidence indicator. After a significant increase last year, consumer sentiment began to deteriorate again, and trade tensions in April likely intensified this process.In Sweden, the latest data on the unemployment rate is expected to be published. Given the continuing risks for companies that constrain their staffing plans, the negative trend may continue. Nevertheless, we forecast a decrease in the unemployment rate by the end of the year, although it will take several months to be sure.Key events of the week: PMI and tariff negotiationsThe key events of the week will be the publication of business activity indices (PMI) for April, scheduled for Wednesday. These data will provide the first estimates of the impact of trade uncertainty after Liberation Day. Any progress in the negotiation process between the United States and China, as well as changes in investor sentiment, will continue to affect market dynamics.An overview of Easter Week eventsIn the US, March retail sales showed resilience, rising by 1.4%, which was in line with expectations. Despite the decrease in gasoline prices, which held back the overall figure, the growth in sales of cars and catering services supported the overall dynamics. This suggests that so far weak consumer sentiment indicators have not had a serious impact on real spending.The Philadelphia Federal Reserve's manufacturing activity indicator weakened sharply in April, falling from 8.7 to -34.2 points. This may indicate a possible deterioration in the PMI in the first release after the holidays.Fed officials in their statements during Easter confirmed their commitment to a wait-and-see attitude. Chairman Jerome Powell stressed the need for caution, and New York Fed President John Williams also does not expect urgent policy changes. At the same time, market participants' attention is focused on Trump's ongoing attacks on the Fed's independence.European policy: results of the ECB meetingThe European Central Bank, as expected, lowered interest rates by 25 basis points, bringing the deposit rate to 2.25%. The regulator's comments were generally "mild": the risks of a slowdown in economic growth were emphasized with a moderate assessment of inflationary threats. This caused a decline in European bond yields and a local weakening of the euro against the dollar, although weak statistics from the United States then supported the cross.Our forecast assumes the continuation of the ECB rate reduction cycle, with the aim of reducing the deposit rate to 1.50% by September 2025.China and the Trade WarsChinese regulators kept the base rates at 3.10% for one-year loans and 3.60% for five-year loans. However, on the political front, Beijing has accused the United States of abusing its tariff policy and warned other countries against entering into agreements with Washington to the detriment of China. This statement was made against the background of rumors about possible US pressure measures on third countries as part of a trade confrontation.UK inflation and Bank of England policyIn the UK, inflation in March was below forecasts. The annual growth rate of consumer prices decreased to 2.6%, mainly due to cheaper transport services and leisure goods. The slowdown in inflationary pressure reinforces expectations of another rate cut by the Bank of England at its meeting in May.Central bank decisions: Denmark, Canada, TurkeyThe central bank of Denmark followed the example of the ECB and lowered its key interest rate by 25 basis points to 1.85%. The Bank of Canada maintained its rate at 2.75%, confirming its commitment to an inflation target of 2% and supplementing the forecast with two scenarios depending on the further escalation of the trade war.The central bank of Turkey unexpectedly raised the rate immediately by 350 basis points to 46%, which was a surprise to the markets.Japan: inflation and policy of the Bank of JapanIn Japan, core inflation rose to 3.2% year-on-year in March, in line with forecasts. The head of the Bank of Japan, Kazuo Ueda, confirmed his readiness to continue tightening monetary policy if inflation continues to accelerate, although a cautious approach remains amid uncertainty in global trade.Commodity markets: oil and goldOil prices dropped by more than 2% due to expectations of progress in negotiations on Iran's nuclear program. In the morning, Brent crude oil is trading around $67 per barrel.Gold prices continue to update records, approaching the level of $ 3,488 per troy ounce, reflecting the steady demand for safe haven assets.Stock markets: mood remains tenseAgainst the background of the Easter holidays, stock markets showed weakness. American indices have lost more than 4% over the past five trading days, while European markets have shown moderate growth. Volatility has increased: the VIX index has risen to 33 points. At the same time, the growth of the euro adds pressure on dollar assets in investors' portfolios.Debt market and currenciesThe US dollar continues to decline amid political instability and pressure on the Fed from the White House. Short-term rates in the United States have fallen, while long-term rates continue to rise, indicating an increase in the yield gap. Against the background of the ECB's softening position, yields in Europe continue to decline, and the EUR/SEK pair is moving towards fair levels around ...
Focus on Germany: ZEW Sentiment index and expectationsToday, the key event on the European macroeconomic agenda will be the publication of the ZEW index of economic sentiment for Germany for March. According to the consensus forecast, the index value may drop significantly to 9.5 points, which is likely due to the ongoing turbulence in global trade and weak readings of economic indicators in the region. Recall that in February, the indicator of current economic conditions unexpectedly rose to 51.6 after a January jump from 26.0, ending a six-month downward trend. This time, the market expects only a slight improvement in the current estimate, to -86.8 from -87.6 last month.Sweden's spring budget: no market effectIn Sweden, the spring revision of the state budget will be presented at 8:00 Central European time. The main parameters of the project are already known: the volume of reforms is 11.5 billion crowns, while the central initiative will be the extension of tax benefits for housing repairs. Earlier in March, the government announced plans for a long-term increase in defense spending, but the final targets for them will be formed only in June, after the NATO summit, and they will not be included in the current budget version. For this reason, the impact of the document on financial markets will be minimal.United Kingdom: labor market dataAt 8:00 a.m., the UK will publish the employment report for February-March. Although this event traditionally has an impact on the pound, the current market agenda is focused on trade conflicts and interest rate policy, so the reaction to the publication may be limited.Overall market picture: cautious optimism amid tariff uncertaintyThe main attention of market participants remains focused on the escalation of tariff disputes. In the United States, Fed member Christopher Waller made a mild comment, noting that in the face of a significant slowdown in the economy due to high tariffs, he would support an earlier and large-scale rate cut. His words are especially important, given that Waller often reflects a consensus opinion within the FOMC.In China, exports increased by 12.4% YoY in March, significantly exceeding expectations (4.4%). However, given the upcoming tariff policy changes, these data are temporary. In April, we can expect a sharp decline in shipments, especially towards the United States. Against this background, the global trade picture remains uncertain.Financial markets: cautious recovery in risk appetiteStocks on global markets showed growth on Monday amid hopes that the peak of the tariff war may have already passed. European securities outperformed American ones, and defensive sectors outperformed cyclical ones in terms of profitability for the third day in a row – a clear signal that investors are becoming more selective and are beginning to take into account structural risks.On Wall Street, all key indexes closed in positive territory: The Dow Jones and S&P 500 gained 0.8% each, the Nasdaq 0.6%, and the Russell 2000 1.1%. Positive sentiment prevailed in Asia on Tuesday, with European futures also showing growth.Dollar, Euro and yields: EUR/USD recoveryAfter falling to the level of 1.1300, the EUR/USD currency pair regained momentum amid easing concerns about the recession in the United States and signs of flexibility in the tariff policy of the White House. The Norwegian krone and the British pound also showed growth following the stock indexes. In Europe, yields on two-year swaps dropped below 2%, reflecting a general shift towards a soft policy. US government bond yields also declined, partly due to Waller's comments, which focused on the possible reaction of the Fed in the event of a slowdown in the labor market.Today, special attention will be paid to the "tax day" in the United States – the date when the maximum inflow of funds to the budget traditionally occurs, which can affect the short-term liquidity and dynamics of treasury ...
Escalation of the tariff war: the US and China continue their confrontationFinancial markets are in a state of heightened anxiety as investors closely monitor further actions by US President Donald Trump as part of the ongoing tariff confrontation. At the moment, most countries face a 10% duty on a wide range of exported goods, as well as a 25% tariff on automobiles, steel, aluminum, and products from Canada and Mexico. China, by contrast, is in the worst position, facing a record 145% interest rate.The markets have already partially priced in further escalation, but the current measures from the United States represent an actual tightening of fiscal policy, which increases the likelihood of a recession. On the other hand, China is expected to take stimulating steps, possibly lowering the benchmark interest rate after Easter. At the same time, a devaluation of the yuan is unlikely, since Beijing prefers to maintain the stability of the exchange rate.Eurozone: inflation is losing priority, the focus is on slowing growthOn Wednesday, the publication of the final data on inflation in the eurozone for March is expected. The consensus forecast assumes confirmation of the preliminary values, and the market is likely not to react to the release. Investors' attention has already shifted from the inflationary agenda to economic growth prospects and trade risks.On Thursday, the ECB is expected to cut its key interest rate by 25 basis points to 2.25%. The accompanying statement is likely to repeat the phrase that monetary policy is becoming "less restrictive." The head of the regulator, Christine Lagarde, is likely to focus on the deterioration of the macroeconomic outlook, but there will be no direct hints on the next steps on rates.Current events: signals from the USA and AsiaThe US president has announced new tariffs on semiconductors in the coming week. In parallel, an investigation has been launched into national security issues in the semiconductor sector. At the same time, Trump stated the need for "flexibility" in trade issues. On the other hand, Chinese Leader Xi Jinping began his first foreign trip this year, visiting Vietnam, Malaysia and Cambodia. The visit underscores Beijing's desire to strengthen regional ties and forge a multipolar order.Over the weekend, the United States excluded a number of high—tech goods from retaliatory tariffs - smartphones, chip manufacturing equipment and some computers. This provided short-term relief for the American IT sector. However, as noted by Commerce Secretary Howard Latnick, these goods may still be subject to future tariffs on semiconductors expected before May.Macroeconomic data: alarming signals from the United StatesA preliminary survey of consumer sentiment from the University of Michigan for April revealed a sharp deterioration in indicators. The index fell to 50.8 from 57.0 in March, while expectations and current estimates also declined more than expected. At the same time, inflation expectations for the year ahead rose to 6.7%, which increases concerns about lost price control.Producer prices in March, on the contrary, showed a decrease — the PPI index dropped to 2.7% in annual terms, which turned out to be lower than expected. This indicates that manufacturers did not have time to shift potential tariff costs to the final price in anticipation of new duties.Regional inflation: Swedish stabilityIn Sweden, the final March inflation data coincided with estimates: CPI at 0.5% YoY, CPIF at 2.3% YoY. Food inflation accelerated, while other components, including clothing, transportation, and housing, showed declines. Thus, inflation remains below the Riksbank's target level for the eighth month in a row, which supports the regulator's cautious position.Stock markets: optimism with caveatsUS stock markets ended Friday on a positive note — the S&P 500 index gained 1.8%, playing off the news about the exclusion of IT products from tariffs. Apple shares have become the engine of growth. European markets lagged behind in dynamics, but futures indicate a possible increase at the opening. It is worth noting that since the beginning of the year, European stocks have been outperforming American stocks in terms of profitability.Bond and currency markets: dollar under pressure, U.S. yields risingThe EUR/USD pair briefly dropped below 1.13 on Friday, as the weakening of tariff threats supported the dollar. However, overall confidence in American assets remains in question. The yield gap between the US and Europe has become noticeably wider: the yield on 10-year US bonds rose by 50 bps to 4.5%, while German securities remained virtually unchanged (2.55%). Scandinavian currencies remain vulnerable amid global capital flows and high uncertainty.ResultsMarkets continue to balance between the hope of stabilizing trade relations and the reality of increased global risks. Further steps by the United States on tariffs, China's reaction, and central bank policies will determine market movements in the coming ...