Insecurity

25 Mar 2025 2 min read

Daily update

  • Reports that the US vice president and cabinet members discussed war plans on a public chat channel with a journalist in attendance do not directly impact markets. However, the chat messages reveal administration officials’ attitudes (e.g. toward Europe), and raise general questions about the conduct of policy. Any lessening of international security cooperation may impact broader (economic) policy cooperation.
  • US President Trump continued their erratic tax policy with fresh tariff announcements. US consumers face a 25% tax on goods from countries that import oil from Venezuela. In 2024, US imports of oil from Venezuela were 230,000 barrels of oil / day. Taxes on US buyers of foreign cars and pharmaceuticals were promised, but some so-called reciprocal tariffs may receive exemptions.
  • Venezuela agreed to take deportees from the US before the tax was announced—this tax means other countries may become wary of doing deals with the US. The erratic stream of trade tax announcements are subject to diminishing returns. Trade with the US is important, but not necessarily essential. Countries have to weigh the benefits of trading with the US against the costs of uncertainty.
  • There are more business and consumer sentiment polls from Europe and the US. It is very hard to put any reliance on these reports.
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