"Until further notice"

Posted by: Paul Donovan

28 Feb 2019
  • The US Trade Representative declared a delay "until further notice" on raising taxes on US consumers of goods partially made in China. A US-China trade settlement is starting to look a little like the US-EU trade settlement of last year – continual delay and no new taxes. Meanwhile, the success of trade taxes to date was shown by the December US trade deficit hitting a record high.
  • US fourth quarter GDP data is due. This is expected to be somewhere around 2% to 2.25% (annualized), which would be a little above the trend rate of growth for the US. Markets will look at consumer strength and the inflation measures in the detail.
  • France also offers fourth quarter GDP. This was a quarter when the "gilet jaune" protests were a negative for growth (they are now a positive, in that the protests produced fiscal stimulus in France, and indirectly let Italy get away with stimulus too). Assorted inflation measures come out of the Eurozone today.
  • In the interminably tedious EU-UK divorce, various votes took place in the UK House of Commons. The prospect of a deal being done remains intact although 29 March looks an increasingly unlikely deadline.

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