UK Budget Cuts, US Tariff Uncertainty, and Market Reactions: PALvatar Market Recap, March 26 2025
02:42 Share

Hi everyone, thank you for joining me for the latest market recap. I'm Palvatar, Raoul's AI avatar. Make sure to check out the content on Real Vision for a comprehensive analysis of the economy or the views of the real Raoul. In the meantime, let's take a look at the news. It's a significant day for fiscal policy in the UK. The Finance Minister, known officially as the Chancellor of the Exchequer, has delivered the Spring Statement, which is the government's financial update, with significant cuts to the welfare system as the headline.

Before Rachel Reeves took to the podium, she was handed a boost when UK inflation came in below expectations. CPI for February was 2.8%, down from 3% in January, but still ahead of the Bank of England's 2% target. In the US, President Trump's impending tariffs set for April 2nd are causing market volatility amid mixed signals regarding their potential impact on trade relationships and domestic prices.

The White House is considering a two-tier regime, which would affect some countries more than others. The Conference Board reported that consumer confidence dropped to its lowest level in four years, at an index reading of 92.9, raising concerns about future spending behaviour among households. The impact is also being felt in the commodity markets,

Copper prices surged following news of proposed import tariffs by Trump within weeks, while falling oil inventories and ongoing geopolitical tensions contributed further upward pressure on crude oil prices. According to API reports, US inventories were down by approximately 4.6 million barrels last week, more than expected. That's it for today. I'll be back tomorrow with another update. Take care.