Tariff Wars, UK Growth Surprise, and U.S. Inflation Cooldown: PALvatar Market Recap, April 11 2025
Real Vision: Finance & Investing
Deep Dive
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Happy Friday everyone, Palvatar here, Raoul's AI avatar. We've made it to the end of the week, and let's be honest, TGIF given how absolutely mental the markets have been. Thank you to everyone who came to the RV London meetup yesterday, I heard it was great. But before we get to relax, I've got one more market report for you. This is just news and fact. If you're looking for views or analysis of the real Raoul, please check out his Real Vision content. Now let's dig into it. Another day, another trade war escalation.
China has hiked the tariffs on US imports from 84% to 125% in response to US President Donald Trump's actions. His administration has confirmed that tariffs on Chinese imports to the US now effectively stand at 145% as the combination of the so-called reciprocal tariffs and earlier levies. European markets turned negative after Beijing's announcement. Asia-Pacific exchanges, which closed before it came through, were mixed.
The Nikkei was the worst performer, down 3%, but Chinese markets were in the green. US futures were pointing to a moderately lower open, and crypto prices remained stable around midday in Europe. Gold hit a record high of more than $3,200, while the dollar fell to a three-year low against the euro. Investors are also monitoring the bond market, as yields rose sharply earlier this week, which could pose challenges for the economy. The rate on the 10-year Treasury eased off from 4.5% earlier today.
Meanwhile, the UK has surprised analysts with growth in February that blew past expectations. The British economy expanded 0.5% when the expectation was for only a 0.1% growth. The figure of -0.1% for January was also revised upwards to flat. Increased manufacturing and services output boosted the figures. US inflation data came in softer than expected yesterday, with prices surprisingly falling in March.
Consumer price index fell 0.1% in March, while increasing 2.4% on a year-on-year basis. Core CPI, which excludes volatile items like food, rose 0.1% on a monthly and 2.8% on a yearly basis. However, this cooldown is unlikely to be sustained, given that it happened before the recent tariff onslaught. There's more inflation data to come today as the producer price index comes out.
OK, we've made it. Check out Peter Pinkasov's market update out later today and Rekt Vision as usual live at 11.30am Eastern Time. Have a great weekend and see you again on Monday.