EU set to freeze US trade deal ratification over tariff uncertainty - complete chaos - what does this mean for imports/exports?
Vonnie Quinn
Steven Major
Trade uncertainty means deferral of decisions, which is not good for growth; this underlines trend toward weaker growth and stacks up potential for rate cuts in second half of year.
Why aren't we seeing more bid into Treasuries given the uncertainty?
Vonnie Quinn
Steven Major
Uncertainty triggers flight to quality; bonds don't look out of place with yields above 4%; markets comfortable policy rates aren't coming down now but could come down hard and fast in second half.
What about the dollar - we're seeing decline, benefiting other currencies?
Vonnie Quinn
Steven Major
Dollar down from year ago but DXY in range; too early to talk about secular decline; no evidence of de-dollarization; not good for dollar on surface but mainly cyclical factor from growth decline.
Yale budget lab projections show negative effects of tariffs halved - will all impacts be less negative if tariffs come off?
Vonnie Quinn
Steven Major
Removing tariffs is unambiguously disinflationary; if tariffs added 1% to CPI, that washes out through time; uncertainty means deferral of decisions which favors bonds over risk assets.