Financial markets remained volatile as investors reacted to rising policy uncertainty, trade tensions and weakening consumer confidence.
Financial market volatility persisted through last week, with a notable rebound on Friday that partially mitigated earlier declines. In particular, US equities experienced a significant rally on Friday, marking their strongest one-day performance since November after entering correction territory midweek.
This volatility reflects the uncertainty in macroeconomic policy, primarily influenced by President Trump’s trade policies. In recent weeks, the US has implemented tariffs on steel and aluminium imports, leading to retaliatory measures from Canada and the European Union. Additionally, Trump has proposed a 200% tariff on European wines and spirits, further escalating tensions with important trading partners. These developments have raised concerns about potential inflationary pressures and constraints on economic growth.
