The Trump administration has delayed the aluminum and steel tariffs that were to be imposed May 1st until June 1. The main reason for the extension is that principle agreements have been made with Europe, Argentina, Brazil and Australia. Canada and Mexico are in negotiations with the United States on NAFTA which will cover cross-border trade between the three countries. Treasury Secretary Mnuchin will be traveling to China this month to hash out a trade agreement of some sort in hopes to calm a potential trade war which has only been a war or words; with no implementation.
The Federal Reserve is expected to leave interest rates unchanged this week, even as US 1st quarter GDP posted better than the expected 2.0% at 2.3% last Friday, the drop in growth from Q4 of last year 2.9% will give the Fed merit to remain cautious in tomorrow’s release. It has been noted that economic growth in the US and inflation pressure will warrant the Fed to continue on its tightening path through the latter part of this year. ISM Manufacturing PMI is expected at 58.4 slightly lower than previous of 59.3, the indicator shows expansion within the industry on levels above 50.0, while below 50.0 indicates contraction.
US equity futures are pointing to a softer open in continuation of yesterday’s sell off, which saw the Dow down 148pts and the S&P down 21.86pts. The Dollar Index continues to flourish as markets correct and is up 0.45 point or 0.48% to 92.26 that is up 2.29% from the beginning of April