Markets disappointed by US-UK trade deal
|Today’s US-UK trade deal takes on more importance for global markets than meets the eye. Britain has unexpectedly jumped to the front of the queue in discussions with the White House and, as this is the first deal to be struck in the post-Liberation Day era, the details are likely to act as a blueprint for other countries’ negotiations.
The main focus surrounded whether the 10% baseline tariff would be relaxed, or if the easing in restrictions would merely be limited to certain sectors. The fact that it is the latter is not at all surprising, not least as Trump still needs the revenue to fund his US tax cuts. This does at least throw shade over the extent to which these tariffs can be negotiated away, and how far the President is willing to go to restore some semblance of global free trade.
So far, we’ve seen little signs of euphoria in UK financial markets, which tells you all you need to know about how investors are viewing the deal.
Let’s not forget that this is also far from a full-blown trade agreement, which will likely take months, if not years, to be finalised, and it will still be some time before the finer details are ironed out.
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