Follow Paul Donovan

Tax reform day (maybe)

| Posted by: Paul Donovan | Tags: Paul Donovan

  • Today is supposed to be the unveiling of the US tax reform proposals, but nothing has been tweeted yet. Leaks suggest a 10% tax on repatriated earnings, encouraging companies to bring money back to the US. This is unlikely to be dollar positive, it could be dollar negative, and may not do much for domestic investment.
  • What has appeared on the Trump Twitter feed is an escalation of tensions over agricultural trade with Canada (yoghurt, which as the French can testify may be a strategic national asset, is a source of concern). There has been no trade war, but the accent of US policy has become more protectionist.
  • France has consumer sentiment due for release, which is only of interest as there is a presidential election going on in the background. Apathetic consumers might imply apathetic voters.
  • Australian consumer price inflation is back in the central bank's target range. However, there is little information for the rest of the world as the drivers of inflation were mainly domestic (absent oil price swings, consumer prices are generally a largely local affair).