Weekly economic commentary: Tariff policy remains yop of mind

Summary

United States: They say waiting is the hardest part

• Next week should bring clarity about details of tariff policies. Economic data released this week are shaping up in an ugly way for Q1. Advance goods trade data combined with only a modest rebound in February consumer spending put growth on track for the weakest quarterly print in two-and-a-half years. It's unclear if this can all be chalked up to “temporary” tariff effects.

• Next week: ISM Manufacturing & Services (Tue. & Thu.), Trade Balance (Thu.), Employment (Fri.)

International: Tariff policy remains top of mind

• Tariffs are a major influence over the global economic, policy and FX outlook. While our global GDP forecast is unchanged, tariff sensitivity is affecting economies around the world. At the same time, FX markets seem somewhat immune to tariffs, at least for now. Could that change on reciprocal tariff day? Time will tell.

• Next week: Colombia Central Bank (Mon.), Eurozone Inflation (Tue.), April 2 Tariff Deadline (Wed.)

Credit market insights: You can't always get what you want: Consumers report worsening in credit access expectations

• Last week, the Federal Reserve Bank of New York released the February 2025 Credit Access Survey. While overall credit demand has held up, a peek underneath the hood reveals an increasing share of consumers that are becoming discouraged from applying for credit. Expectations about credit conditions in the future also appear to be souring.

Topic of the week: Livin' La auto local: US announces auto tariffs

• The U.S. auto industry, yet to fully recover from the pandemic, is facing renewed headwinds due to the prospect of a trade war on the horizon. This week, the Trump administration unveiled plans to enact 25% tariffs on motor vehicle and part imports to the United States.

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