A look at the day ahead in European and global markets |
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By Wayne Cole, Chief Correspondent, Treasury |
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Well, that's as clear as mud. Apparently August 1 is now the U.S. deadline for when higher tariffs will be imposed on some countries if no trade deals are done, or under way. It's not really certain which countries that covers, or which deals. "President Trump's going to be sending letters to some of our trading partners saying that, if you don't move things along, then on August 1, you will boomerang back to your April 2 tariff level," Treasury Secretary Bessent told CNN. The "letters" are going out to 10 or 12 countries today, presumably the same letters that were supposed to go last Friday. |
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U.S. President Donald Trump disembarks Air Force One as he arrives at Joint Base Andrews, Maryland, U.S, July 6, 2025. REUTERS/Nathan Howard |
Commerce Secretary Howard Lutnick told reporters that the higher tariffs would take effect on August 1, but Trump was "setting the rates and the deals right now". Announcing trade policy changes in TV interviews does not make for clarity, and now it's uncertain if the original July 9 deadline matters, and for whom. India and the U.S., for instance, reportedly could make a mini-deal today or tomorrow, but then continue talks after July 9. According to Bessent, it also seems many countries didn't bother to contact the U.S. for talks - and will likely be getting stiff letters in return. Trump added to the confusion by mentioning that some tariffs could reach 60% or 70%, higher even than the 50% set on China. He also threatened an extra 10% tariff on countries aligning themselves with the "anti-American policies" of the BRICS, a group the U.S. itself is in tariff talks with. |
Graphics are produced by Reuters. |
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Investors have reacted with bemusement and nudged Wall St futures down 0.4% or so. Asian share indices are mostly lower on Monday, though not by much, while Treasury yields are down a basis point and the dollar stuck near four-year lows. Oil has been the big mover, losing around 1% after OPEC+ surprised by increasing production by much more than first expected, and flagging a similar increase for September. Analysts largely see this as Saudi Arabia putting the squeeze on higher-cost producers to capture market share, with low-margin U.S. shale output under particular pressure. It's OPEC's answer to "Drill, baby, drill". |
Graphics are produced by Reuters. |
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Key developments that could influence markets on Monday: |
- EU retail sales for May, Sentix investor confidence for July; German industrial output for May
- Participation by ECB President Christine Lagarde and ECB board member Piero Cipollone in Eurogroup meeting in Brussels; ECB's Holzmann Speak
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