Economics weekly

Markets pricing in further rate cuts on Trump tariff newsflow

DAVY VIEW

A busy weekend of tariff-related newsflow from the US has culminated in market pricing of an additional rate cut this year in both the UK and euro area. Since this is despite ongoing above-target inflation and fears that tariffs could prove stagflationary, it would not be surprising to see repricing towards fewer cuts. So far, President Trump has won some concessions from Canada and Mexico and has paused tariff plans. Such policy-driven volatility was expected, and we continue to hold a benign outlook for the Irish economy given a favourable exposure to less-cyclical sectors at the frontier of global technological innovation.

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Feb 4 2025, 08:49 GMT

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