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US businesses do not like trade taxes

| Posted by: Paul Donovan | Tags: Paul Donovan

The US Federal Reserve's Beige Book (an economist's "Hello" magazine of anecdote and gossip) mentioned "tariff" 36 times, and not in a good way. This is not surprising. The economic cost of trade taxes was always likely to exceed any benefit from US President Trump's tariff signing Twitter moment. Otherwise, the economy was reported to be doing fine.

Eurozone current account data is due. In today's fevered environment of trade tensions, this has more market importance than it would normally have, although it is still not a key release. US President Trump and Japanese PM Abe announced trade talks, while disagreeing on what the aim should be.

The UK House of Lords voted in favor of negotiating a new customs union with the EU when the EU is cut off from the UK single market. It supports the idea of a soft exit – although EU negotiations are too tedious for anyone to pay much attention. UK retail sales are due. Weather may distort the data.

Assorted Bank of England and Federal Reserve speakers are on the agenda today. The US offers the Philly Fed opinion poll on economic sentiment, but this is an irrelevance that need not detain us.